Subtitle: From Technological Blockades to Market Backlash, the Deep Changes Behind NVIDIA’s Loss in China
Shocking Declaration: Jensen Huang’s “0%” Moment
In mid-October 2025, Silicon Valley, California, an otherwise ordinary investment forum was shaken by a single statement that reverberated throughout the global tech community. NVIDIA’s founder and CEO Jensen Huang, in a conversation with a partner from Sequoia Capital,publicly acknowledged for the first time that due to U.S. government export control policies, NVIDIA’s market share in China, the world’s largest AI market, has plummeted from a previous 95% to 0%.
“We have lost one of the largest markets in the world,” Huang’s tone revealed an unmistakable sense of helplessness, “sometimes, policies aimed at hurting others ultimately end up hurting ourselves.”
This brief statement not only announced the complete collapse of a business giant in the Chinese market but also signaled a fundamental reshaping of the global chip industry landscape.
Policy Game: From Technological Blockades to Market Backlash
Increasingly stringent regulatory measures
NVIDIA’s exit from the Chinese market was not coincidental but rather an inevitable result of a series of U.S. government export control policies:
April 2025: The U.S. Department of Commerce required NVIDIA to obtain special permission to export H20 chips to China
July 2025: NVIDIA briefly had hopes of obtaining export licenses, but the approval process subsequently stalled
September 2025: The U.S. government further tightened AI chip export controls, explicitly prohibiting models like H20
October 2025: Huang officially confirmed that NVIDIA has completely exited the Chinese market
The enormous loss of business interests
This policy game has resulted in significant losses for NVIDIA:
- Direct revenue loss: In 2024, NVIDIA’s revenue in mainland China was $17.1 billion, accounting for 13.1% of total revenue
- Market share collapse: From an absolute monopoly of 95% to a complete exit
- Growth momentum hindered: The Chinese market’s share has declined for three consecutive years, affecting overall growth prospects
More importantly, NVIDIA has lost not only short-term revenue but also a strategic opportunity to participate in the development of the world’s largest AI application market.
The fracture and rebirth of the global chip market
Explosive growth in market size
While NVIDIA faced a setback, the global chip market exhibited strong growth momentum:
In 2025, the global market: is expected to reach $781.5 billion, a year-on-year increase of 16.3%
AI-driven growth: Demand for data center chips surged, expected to grow by $86.4 billion
Uneven regional development: The Americas grew by 15.4%, Asia-Pacific by 10.4%, and Europe only by 3.3%
Diversified exploration of technological routes
The global chip industry is entering the “post-Moore’s Law era,” with a trend towards diversified technological development:
Advanced packaging technology: has become a key path to break physical limits, with a market size expected to reach $69.5 billion by 2029
Storage-compute integrated architecture: addresses the “memory wall” and “power wall” issues of traditional architectures, enhancing computational efficiency
New material applications: Emerging materials such as two-dimensional materials and compound semiconductors are opening up new technological spaces
China’s chip industry’s “curve overtaking”
Concentrated outbreak of technological breakthroughs
As the Chinese market closed to NVIDIA, the domestic chip industry in China has entered a period of concentrated technological breakthroughs:
Tsinghua University’s “Yuheng” chip: The world’s first sub-angstrom spectral imaging chip, achieving an astonishing spectral resolution of 0.8 angstroms, surpassing European and American products by 12 times
Peking University’s analog computing chip: The world’s first high-precision analog matrix computing chip, enhancing analog computing precision to 24 bits, achieving a leap of five orders of magnitude
Fudan University’s “Changying CY-01”: A super-fast storage chip based on two-dimensional materials, with read and write speeds 1 million times faster than traditional flash memory, achieving a yield rate of 94.3%
Comprehensive upgrade of the industrial ecosystem
The Chinese chip industry is building a complete ecosystem of independent innovation:
Manufacturing capacity enhancement: By 2027, mainland China will have 71 12-inch wafer fabs, accounting for 29.71% of the global total
Process technology breakthroughs: SMIC’s 5nm yield rate has improved to 92%, supporting mass production of high-end chips
Leading patent layout: In 2024, China’s chip patent applications accounted for 38% of the global total, ranking first for five consecutive years
Counter-trend growth in export trade
The Chinese chip industry is not only meeting domestic demand but is also beginning to go global:
- Export quantity: From January to August 2025, exports reached 233 billion units, a year-on-year increase of 20.8%
- Export value: Reached 905.18 billion yuan, an increase of 23.3%
- Product structure: Gradually upgrading from low-end to mid-to-high-end
NVIDIA’s strategic shift: The path to domestic manufacturing in the U.S.
A historic shift in production lines
In the face of losses in the Chinese market, NVIDIA is accelerating its global strategic adjustment.On October 17, 2025, a historic moment arrived — NVIDIA and TSMC achieved the first wafer of the Blackwell chip at the Fab 21 factory in Phoenix, Arizona.
Jensen Huang personally attended and signed the wafer with TSMC’s Vice President of Operations. He excitedly stated, “This is the first time in modern American history that the most advanced wafer factory has manufactured the most important chips on U.S. soil.”
Technological innovations of the Blackwell chip
As NVIDIA’s latest flagship product, Blackwell represents the highest level of current AI chips:
- Transistor count: Integrates 208 billion transistors, a 150% increase over the previous generation
- Process technology: Utilizes TSMC’s custom 4NP process, significantly improving performance-to-power ratio
- Computational power: The B200 model FP4 achieves 18 PFlops, a 79-fold increase over the Hopper architecture
- Memory configuration: Equipped with 192GB HBM3e memory, with a bandwidth of up to 8TB/s
Strategic expansion of product lines
NVIDIA also launched a new Grace CPU series, attempting to open new growth points beyond AI computing:
- Architectural innovation: Utilizes Arm Neoverse V2 cores, optimized for data centers
- Energy efficiency advantages: Uses LPDDR5X memory, achieving a 5-fold improvement in energy efficiency
- System integration: Achieves seamless collaboration between CPU and GPU through NVLink-C2C technology
Industry restructuring under geopolitical influences
Regionalization trend of global supply chains
The global chip industry is shifting from global division of labor to regional clusters:
U.S.-led technology alliances: Investing hundreds of billions through the CHIPS and Science Act to build a “friend-shoring” system
The EU’s self-development: Launching the European Chips Act, planning to invest hundreds of billions of euros to enhance chip self-sufficiency
China’s independent innovation: Building a complete chip industry ecosystem through policy guidance and market-driven approaches
Risks of technological ecosystem fragmentation
Huang emphasized a key issue during the dialogue:China has about 50% of the world’s AI researchers. Excluding this talent from the U.S. technology ecosystem could have profound strategic implications.
Liu Cheng, director of the Tianjin Multimodal Data Technology Research Institute, pointed out: “The core of competition in the computing chip industry is technological innovation and ecological collaboration, not simple geopolitical games. Only by maintaining open cooperation can the entire industry develop healthily.”
Future landscape: Competition and cooperation in a multipolar era
Short-term reshaping of market dynamics
NVIDIA’s challenges and opportunities:
- Loss of growth momentum in the Chinese market
- Need to find new growth points in the U.S. and other markets
- Facing challenges from competitors like AMD
The development path of the Chinese chip industry:
- Accelerating the process of domestic substitution
- Enhancing technological innovation capabilities
- Building a controllable industrial ecosystem
Long-term technological development trends
- Diversification of technological paths: Advanced packaging, new materials, and new architectures will jointly drive industry progress
- Regionalization of industrial ecosystems: The world will form multiple distinctive chip industry centers
- Collaboration of innovation models: Deep integration of industry, academia, and research to accelerate technology transfer and application
- Complexification of international cooperation: Maintaining cooperation amid competition and managing risks within cooperation
Conclusion: A New Order in an Era of Change
The global chip industry is at a historic turning point. NVIDIA’s exit from the Chinese market marks the end of an era and heralds the beginning of a new one.
This “chip earthquake” not only changes the market landscape but also profoundly influences the direction of global technological development. The rise of China’s chip industry injects new vitality into the global market, while NVIDIA’s strategic adjustments will also promote the enhancement of domestic chip manufacturing capabilities in the U.S.
In this era of change filled with uncertainties, the only certainty is:The pace of technological innovation will not stop, and the demand for global cooperation remains.How to maintain rationality in competition and achieve win-win outcomes in cooperation will be an important proposition for all participants to consider.
The future of the chip industry will be determined by the speed of technological innovation, the degree of improvement in the industrial ecosystem, and the depth of international cooperation. In this multipolar new era, there are no eternal hegemons, only continuous adaptation and innovation.