Huang admits it: China AI chip market handed to Huawei
TL;DR
NVIDIA CEO Jensen Huang on CNBC: «Huawei is very, very strong.» Q2 outlook excludes any China revenue. China used to be ~20% of NVIDIA's data center business.
NVIDIA CEO Jensen Huang said it directly on CNBC: «Huawei is very, very strong. They had a record year and very likely will have an extraordinary year next. China's domestic chip ecosystem is doing well too — because we've exited that market.»
The cost. China was once 20% of NVIDIA's data center revenue. NVIDIA now expects essentially zero from that market — Q2 guidance explicitly excludes any China revenue.
Why we got here. The Trump administration in April required NVIDIA to license exports to China and select other countries — effectively cutting off NVIDIA's path to China while accelerating China's semiconductor self-sufficiency.
Huawei is the biggest winner. Export controls effectively gifted China's massive AI chip demand to Huawei, creating a monopoly position in the China market. Huang says he hopes to return but is cautious about short-term loosening.
NVIDIA's calculus. Losing China is heavy, but global demand still explodes: Q1 revenue $81.6B, +85% YoY; Q2 guidance $91B; $80B buyback announced. Huang says NVIDIA is betting on AI's «five-layer cake» — energy, chips, infrastructure, models, applications — and that company scale can «multiply several times further, not impossible».
This isn't just NVIDIA's sales problem. The global AI chip market is being split along political and supply-chain boundaries.
via CNBC
The cost. China was once 20% of NVIDIA's data center revenue. NVIDIA now expects essentially zero from that market — Q2 guidance explicitly excludes any China revenue.
Why we got here. The Trump administration in April required NVIDIA to license exports to China and select other countries — effectively cutting off NVIDIA's path to China while accelerating China's semiconductor self-sufficiency.
Huawei is the biggest winner. Export controls effectively gifted China's massive AI chip demand to Huawei, creating a monopoly position in the China market. Huang says he hopes to return but is cautious about short-term loosening.
NVIDIA's calculus. Losing China is heavy, but global demand still explodes: Q1 revenue $81.6B, +85% YoY; Q2 guidance $91B; $80B buyback announced. Huang says NVIDIA is betting on AI's «five-layer cake» — energy, chips, infrastructure, models, applications — and that company scale can «multiply several times further, not impossible».
This isn't just NVIDIA's sales problem. The global AI chip market is being split along political and supply-chain boundaries.
via CNBC
