Nvidia Concedes China AI Chip Market to Huawei Amid US-China Summit
Shares surge more than 2% on H200 approval, but strategic focus shifts as rival Huawei gains ground in advanced hardware sector.
Nvidia chief executive officer Jensen Huang has stated that the company has largely conceded China's advanced artificial intelligence chip market to rival Huawei. The admission marks a significant shift in the competitive dynamics for high-performance hardware in the region, occurring against the backdrop of a two-day summit in Beijing between US President Donald Trump and Chinese President Xi Jinping.
The declaration coincides with the first visit by an American president to China since 2017. The diplomatic engagement, which also features attendance from major US technology leaders including Elon Musk and Tim Cook, is focused on trade, artificial intelligence, and regional security issues such as the Strait of Hormuz.
Despite the strategic concession in the advanced segment, market sentiment remained positive during the summit. Nvidia shares surged more than 2% following news that the US government had approved the sale of H200 chips to Chinese firms. This specific regulatory approval provided a counterpoint to Huang’s broader assessment of the market landscape.
Broader market indices also rose during the summit period. The Dow Jones Industrial Average gained 0.8%, the S&P 500 rose 0.3%, and the Nasdaq Composite climbed 0.2%. These movements reflect investor reaction to the easing of immediate trade tensions and the clarity provided by the chip sale approvals.
While Nvidia has adjusted its stance on the advanced Chinese market, the company continues to target a $200 billion total addressable market for agentic AI through its new Vera CPU. Huang noted during a recent earnings call that the Vera architecture has already generated $20 billion in standalone sales this year, highlighting the company's focus on the next generation of AI infrastructure.
The competitive environment for AI hardware continues to evolve rapidly. In May 2026, Cerebras Systems made its Nasdaq debut in a $5.55 billion initial public offering, valuing the company at approximately $95 billion. This entry underscores the intensifying competition and capital flow within the sector as firms vie for dominance in the agentic AI shift.
