GoKawiilA Financial Times report has claimed that Shenzhen-based Huawei is on track to capture the largest share of China’s AI chip market this year, following growing demand from Chinese firms seeking domestic alternatives to American chipmaker Nvidia.
The report comes as Huawei reportedly expects AI chip revenue to surge to $12bn, up from $7.5bn in 2025. The company is basing its forecast of a 60% surge on existing orders for its 950PR chip, which entered mass production just last month. Huawei plans to launch an upgraded version of 950DT in the fourth quarter, as it continues to aggressively expand its chipmaking capabilities.
The move comes as NVIDIA’s China operations — once accounting for up to 25% of its data center business revenue — are being affected by export restrictions and regulatory barriers imposed by both the United States and China amid broader technological and trade tensions between the two countries.
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We reported earlier that Nvidia CEO Jensen Huang confirmed in March 2026 that the company had received U.S. licenses to sell H200 AI chips to China and was restarting production to meet demand. However, despite obtaining U.S. clearance and securing orders from Chinese customers, shipments have faced hurdles, with reports suggesting potential delays due to Chinese import regulations.
The Financial Times report claims that Beijing has instructed Chinese tech companies to limit their use of Nvidia chips to their overseas operations, while supporting domestic manufacturing. On the other hand, US regulators require that all NNvidia chips ordered by Chinese clients only be used in China. These contradictory demands have led to a stalemate in customs clearance for H200 shipments to China.
Most of Huawei's AI chips are manufactured by Semiconductor Manufacturing International Corporation (SMIC), China’s leading fab. The company plans to add two additional dedicated fabrication plants this year. If it successfully ramps production, then its initial revenue forecast will likely see a boost.
In all these, Nvidia's chips remain more advanced. However, Huawei is taking a different strategic approach to compete with Nvidia in AI hardware. The company has improved its chips enough to target a rapidly growing part of the AI market: inference — the computation AI models use to generate answers and perform real-world tasks after training is complete.
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According to the Financial Times, the Chinese tech group has positioned its latest 950PR processors as the hardware of choice for domestic companies running inference.
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