NVIDIA just got shut out of the Chinese market — this time by the Chinese government instead of the US. China's internet regulator, the Cyberspace Administration of China, banned domestic tech companies from buying NVIDIA AI chips on Wednesday, as first reported by the Financial Times.
Key Points:
- China orders ByteDance, Alibaba to cancel all RTX Pro 6000D chip orders immediately
- Beijing claims domestic chips from Huawei and Cambricon now match NVIDIA's China-specific offerings
- This escalates tech tensions ahead of Trump-Xi trade call scheduled for Friday
The Cyberspace Administration of China told tech companies including ByteDance and Alibaba to stop testing and ordering NVIDIA's RTX Pro 6000D server, a product designed specifically for the Chinese market. Companies that had already indicated they'd order tens of thousands of these chips are now scrambling to cancel their orders and halt all testing activities with NVIDIA's suppliers.
This is a remarkable twist in the ongoing semiconductor saga. For years, it's been Washington restricting what chips could go to China — first blocking the high-end H100 and A100, then their watered-down replacements, and most recently playing an on-again, off-again game with export licenses that left everyone confused. Now Beijing is the one saying "thanks, but no thanks" to American silicon.
The RTX Pro 6000D isn't exactly NVIDIA's crown jewel. It's a Blackwell-based workstation card with GDDR7 memory delivering about 1,100 GB/s of bandwidth — just shy of the 1.4 TB/s US export limit. Think of it as Nvidia's attempt to thread the needle between US restrictions and Chinese demand, creating something powerful enough to be useful but neutered enough to pass export controls.
Jensen Huang, who was in London alongside President Trump for a state visit when the news broke, didn't hide his disappointment. "We can only be in service of a market if a country wants us to be," he told reporters. The timing is particularly awkward — Huang said he expected to discuss the issue with Trump at Wednesday evening's state banquet.
Beijing reportedly believes that homegrown AI chip makers, like Huawei and Cambricon, now produce chips that have comparable performance to NVIDIA's China-only products. After consulting with domestic chipmakers about their capabilities, Chinese regulators concluded their processors now match or even exceed the downgraded NVIDIA products allowed into the country.
This confidence might be slightly optimistic. While Huawei's Ascend 910C and Cambricon's Siyuan 590 have made impressive strides, they're still playing catch-up in crucial areas. The software ecosystem remains their Achilles' heel — NVIDIA's CUDA has a decade-plus head start that's hard to replicate overnight. In 2024, Chinese companies bought around 1 million NVIDIA H20 chips compared with an estimated shipment of 450,000 Huawei Ascend 910B chips.
But here's where it gets interesting. The ban is forcing China's biggest tech companies to go all-in on domestic alternatives whether they want to or not. "The message is now loud and clear," an unnamed Chinese tech executive told the Financial Times. "Earlier, people had hopes of renewed NVIDIA supply if the geopolitical situation improves. Now it's all hands on deck to build the domestic system."
The ripple effects were immediate. Chinese chip stocks went wild on Wednesday — Cambricon's shares soared to make it China's most expensive stock by price-earnings ratio, while Alibaba's stock rose after announcing state-owned China Unicom as a customer for its homegrown AI chips. Baidu's Hong Kong shares jumped by their biggest margin in three years.
For NVIDIA, this is another blow to what was once a crucial market. The company had already written off $5.5 billion in chip inventory and another $2.5 billion in unrealized revenue from China restrictions. NVIDIA's CEO, Jensen Huang, has said that NVIDIA's market share in China has declined from 95 percent to 50 percent — and that was before Wednesday's ban.
Trump and Xi Jinping are scheduled to discuss trade on Friday, with semiconductor technology likely high on the agenda. Just days ago, China's market regulator accused NVIDIA of violating antitrust laws over its acquisition of Mellanox, and US lawmakers are investigating NVIDIA's ties to Huawei spinoff Futurewei over espionage concerns.
What makes this ban particularly striking is how it flips the script on tech decoupling. The US spent years trying to keep its best chips away from China to slow its AI development. Now China is saying it doesn't need American chips at all — even the deliberately weakened ones designed just for its market.
Whether Beijing can actually deliver on this tech independence remains to be seen. Huawei will get 600 – 650 thousand of '700 mm2-equivalent' dies from local producers this year and 800 – 850 thousand dies in 2026, according to JP Morgan estimates. That's progress, but still a fraction of what China's booming AI sector demands.
The real test will come when Chinese companies try to train and run next-generation AI models. DeepSeek's recent breakthroughs show Chinese developers can be remarkably resourceful with limited hardware, but there's a difference between making do and truly competing at the cutting edge. For now, Beijing seems willing to bet that national pride and technological sovereignty are worth the performance hit.
The ban represents a calculated gamble by Beijing — that forcing its tech giants onto domestic chips will accelerate the development of a truly independent semiconductor ecosystem, even if it means short-term pain. For NVIDIA and the broader US tech industry, it's a sobering reminder that market access can be a two-way street in the age of tech nationalism.