A new report states that Huawei and Cambricon, the leading chip suppliers in China’s AI segment, will rule over the country’s AI server market, phasing out Nvidia from the game. Both firms can capture approximately 80% of the AI server ground.
SCMP reported that Huawei and Cambricon are ready to dominate China’s AI server market, putting pressure on Nvidia. This will happen as the firms are planning to continue following the “self-reliant” path without any issues.
The report reveals that geopolitical tensions are constantly piling up pressure on Nvidia, Advanced Micro Devices, and some other foreign chip suppliers. The pressure is due to the falling market share in China, which has now reached 21% (combined).
Last year, Nvidia, Advanced Micro, and other US firms held 34%. However, TrendForce noted that this figure will likely drop to 21% in 2026 as of the tech tensions.
On the other hand, Huawei and Cambricon’s market share can jump to 56% in the coming months from 46% in 2025, and may reach 80% by the end of this year.
Chinese internet companies working on the highly specialized application-specific integrated circuits (ASICs) can achieve 23% of the market, 3% up from 2025.
Frank Kung mentioned that China’s largest internet companies are driving AI chip growth, which will also scale up the country’s AI server market. Alibaba and ByteDance still count as the most ultimate companies for building the AI tech infrastructure.
Alibaba and Baidu have also accelerated the development of ASICs through their semiconductor units, which reflects a move towards a global trend, rivaling Google and Amazon.
Kung added:
“These Chinese tech giants are not only the biggest buyers of servers and AI infrastructure, but we also expect them to become the most promising players in in-house chip development going forward. Geopolitical tensions and tariff-related uncertainties will remain the biggest risks next year.”
(Image Credits: Weibo)
