Nvidia, AMD China AI chip share to drop to 21% in 2026, TrendForce says

Nvidia ↘ 1.47% and AMD's Advanced Micro Devices, Inc. ↘ 1.47% combined share of China's AI server chip market is forecast to fall to just 21% in 2026, down from 34% last year, according to new data from Taipei-based research firm TrendForce presented at its industry conference in Shenzhen. The projection marks an acceleration of a years-long retreat driven by U.S. export controls and Beijing's push for self-sufficient AI infrastructure.

Domestic Chipmakers Fill the Void

Domestic chip suppliers led by Huawei and Cambricon are expected to capture 56% of the market in 2026, up from 46% the previous year, according to TrendForce. Adding in custom application-specific integrated circuits designed by Chinese internet giants including Alibaba ↘ 4.74%, Baidu ↘ 2.87%, and Tencent — projected at 23% of the market — homegrown silicon is set to cover close to 80% of China's AI server hardware this year.shanethegamer+1

A separate TrendForce supply chain report released on August 10 went further, estimating that domestic solutions could capture nearly 90% of the high-end AI chip segment specifically, reflecting a broader shift in procurement away from overseas GPUs. Bernstein, the equity research firm, has separately forecast that Nvidia's individual share could drop to around 8%, down from roughly 40% in 2025, while Huawei's share rises to approximately 50%.wccftech+3

TrendForce research manager Frank Kung said at the Shenzhen conference that "this segment will continue to scale up" as geopolitical uncertainty and Beijing's self-reliance drive accelerate adoption of domestic processors.shanethegamer

Training Still Runs on Nvidia — For Now

Despite the procurement shift, China's most advanced AI models are still being trained on Nvidia hardware. The South China Morning Post reported that high transition costs continue to keep major Chinese large language model developers reliant on Nvidia's chips. Nvidia's CUDA software platform remains the industry standard, and migrating to alternatives such as Huawei's CANN architecture requires extensive code rewrites. "CUDA code cannot run directly on Ascend and requires extensive rewriting," said James Wang, an AI researcher at a Shanghai-based university, who estimated that migration could add at least 50% in time and costs.scmp

The Shift May Be Irreversible

The U.S. has approved limited H200 chip sales to select Chinese companies, but TrendForce's August 10 assessment noted that actual shipments remain subject to approvals from both governments, leaving supply uncertain. That uncertainty is itself pushing Chinese firms to design domestic chips into projects from the outset rather than treating them as temporary substitutes.kucoin

TrendForce expects the combined capital expenditures of ByteDance, Tencent, Alibaba, and Baidu to grow by more than 80% year-over-year in 2026, channeling demand toward local supply chains. Nvidia CEO Jensen Huang has acknowledged the challenge, telling the Associated Press that the company previously held roughly 95% market share in China before export controls cut into shipments.marketscale+1

Globally, Nvidia remains dominant, with TrendForce projecting it will hold about 64% of the worldwide AI server GPU market. But inside China, the question facing the company is no longer whether it can compete — it is whether the market it once commanded will remain accessible at all.shanethegamer