TrendForce: Nvidia, AMD Combined China AI Chip Share to Fall to 21% in 2026

Tane Wharekura10/08/2026Updated 25/08/20265 min read

Nvidia and AMD’s combined share of China’s AI server chip market is on track to shrink to just 21 percent in 2026, down sharply from 34 percent last year, according to a new forecast from Taiwan-based market research firm TrendForce. Geopolitical tensions continue to erode the position of Nvidia, Advanced Micro Devices and other foreign suppliers, whose combined share of China’s AI server market is forecast to fall to 21 per cent in 2026 from 34 per cent last year, according to the Taipei-based research firm. The forecast, presented at a TrendForce industry event in Shenzhen, underscores how quickly Beijing’s self-sufficiency drive is reshaping the world’s second-largest AI hardware market.

The flip side of that decline is a rapid rise for domestic Chinese chipmakers. Domestic chip suppliers, led by Huawei and Cambricon, are expected to increase their market share to 56 per cent in 2026, up from 46 per cent in 2025. Layer in the custom silicon that Chinese internet giants are designing for their own data centres, and homegrown compute is closing in on four-fifths of the entire domestic market.

Huawei, Cambricon and In-House ASICs Fill the Gap

Beyond the headline GPU-versus-domestic-chip split, TrendForce is also tracking a parallel trend: Chinese tech giants building their own application-specific chips instead of buying off-the-shelf silicon. Highly specialised application-specific integrated circuits (ASICs) designed by Chinese internet companies are projected to account for 23 per cent of the market, compared with 20 per cent a year earlier. Add that figure to the 56 percent share expected for dedicated AI chipmakers, and Chinese-designed silicon of one form or another is set to cover close to 80 percent of the country’s AI server hardware this year, a threshold flagged by outlets including South China Morning Post and Korea’s Digital Today.

Huawei and Cambricon sit at the centre of that shift. SCMP reported that Huawei and Cambricon are ready to dominate China’s AI server market, putting pressure on Nvidia, as the firms continue following the “self-reliant” path. TrendForce research manager Frank Kung, speaking at the company’s Shenzhen conference, said “this segment will continue to scale up” as geopolitical uncertainty and Beijing’s push for technological self-reliance accelerate adoption. Kung added that China’s largest internet companies are driving AI chip growth, rapidly expanding their deployment of domestic processors from suppliers such as Huawei and Cambricon, with ByteDance and Alibaba named among the most aggressive builders of AI infrastructure.

Nvidia Still Leads Globally Despite the China Squeeze

The China figures don’t tell the whole story for Nvidia’s business. On the global stage, TrendForce still expects the company to dominate the AI server GPU market this coming year. Global AI server shipments are expected to grow by more than 28 percent this year, with Nvidia predicted to hold about 64 percent of the worldwide market next year, followed by AMD with 8.6 percent. By contrast, Chinese AI GPU makers led by Huawei and Cambricon could take up to 20 percent of the global market next year, TrendForce predicted.

That gap between Nvidia’s dominant worldwide position and its retreat inside China shows how narrowly the export-control fight is concentrated in one geography, rather than threatening the company’s overall AI leadership. Kung reportedly cautioned that geopolitical tensions and tariff-related uncertainty remain the biggest risk factors for the global market next year. That could still push the China trend into broader supply chain planning for both Nvidia and AMD.

Export Curbs Behind China’s Push for Chip Independence

The reshuffle didn’t happen overnight. Since Washington tightened export rules on advanced AI accelerators, Nvidia’s China share has been on a multi-year slide, the company reportedly held around 95 percent of the Chinese market four years ago before controls on chips like the H20 and H200 began cutting into shipments. Beijing has simultaneously pushed government-linked data centres and major cloud providers to prioritise homegrown alternatives from Huawei, Cambricon and in-house ASIC teams at Alibaba, Baidu and Tencent, accelerating the transition TrendForce is now quantifying.

Silicon UK, corroborating the same TrendForce data, reported that the local surge is being driven by China’s biggest technology firms building out AI infrastructure at scale. China’s largest tech firms are driving the expansion of AI infrastructure, such as data centres running AI GPUs alongside general-purpose processing units, TrendForce said at its conference in China’s tech hub, Shenzhen. The pattern mirrors what’s happening among Western hyperscalers, where large tech firms in the West, including Amazon and Google, are similarly developing and using ASICs alongside third-party chips, and in some cases are selling the chips or renting capacity to customers.

Why This Matters Beyond the Data Centre

For gamers and PC hardware watchers outside China, this isn’t a story about graphics cards under your desk: it’s about where Nvidia and AMD’s AI revenue, and by extension their R&D budgets for future GeForce and Radeon silicon, are ultimately generated. Both companies have leaned heavily on data centre AI income in recent years, and a shrinking China slice of that pie adds pressure to diversify sales elsewhere, including through gaming and consumer GPU lines.

It also points to a longer-term structural shift in the global chip industry that Australian and New Zealand tech buyers should watch: as Chinese AI accelerator makers scale domestically, TrendForce’s own figures suggest they could begin exporting spare capacity, competing for slices of the global AI market that Nvidia and AMD currently dominate. Whether that translates into cheaper or more varied hardware options down the line remains speculative, but the shift in China is already reshaping how the world’s two biggest GPU makers plan their next few years.