Nvidia Leadership Sounds Alarm Over US Chip Export Policies
In a striking critique of American trade policy, Nvidia CEO Jensen Huang has warned that measures intended to restrict China's technological advancement are backfiring dramatically on the United States. Speaking in an October 2025 interview with Citadel Securities, Huang expressed frustration that policies harming China often end up damaging American interests more severely.
"Before we leap towards policies that are hurtful to other people, take a step back and maybe reflect on what are the policies that are helpful to America," Huang urged policymakers during the candid discussion.
Catastrophic Market Share Collapse
The Nvidia chief revealed staggering statistics about his company's experience in the Chinese market. Nvidia's share in China has plummeted from a dominant 95% to virtually zero following US export restrictions on advanced semiconductors.
"We went from 95% market share to 0%, and so I can't imagine any policymaker thinking that that's a good idea, that whatever policy we implemented caused America to lose one of the largest markets in the world," Huang lamented.
CFO Confirms Ongoing China Struggles
Nearly five months after Huang's initial comments, Nvidia Chief Financial Officer Colette Kress provided an update during the company's earnings call that confirmed the dire situation persists. Despite some easing of Washington's restrictions, Nvidia has yet to recover its lost sales in China.
"While small amounts of H200 semiconductor products for China-based customers were approved by the US government, we have yet to generate any revenue," Kress revealed, according to a FactSet transcript reported by Reuters.
The CFO expressed uncertainty about future prospects, stating: "We do not know whether any imports will be allowed into China."
Rising Chinese Competition Threatens Global AI Leadership
Both Nvidia executives warned about the unintended consequences of US policies strengthening Chinese competitors. Kress specifically highlighted how Chinese semiconductor firms, "bolstered by recent IPOs, are making progress and have the potential to disrupt the structure of the global AI industry over the long-term."
Similar to Huang, Kress urged US policymakers to encourage global adoption of American technology rather than restricting it. "Our competitors in China, bolstered by recent IPOs, are making progress and have the potential to disrupt the structure of the global AI industry over the long-term," she cautioned.
The Complex Geopolitical Landscape for Chip Sales
Escalating US-China Tech War
The semiconductor industry has become a central battleground in the broader technological competition between Washington and Beijing. Nvidia's advanced processors have transformed from commercial products into political bargaining chips in the ongoing trade tensions.
China has responded to US restrictions with countermeasures of its own, placing strict limits on exports of rare earth elements—critical materials for manufacturing advanced technologies including semiconductors.
Regulatory Hurdles and Workarounds
The regulatory challenges for Nvidia have been multifaceted:
- In April 2025, the Trump administration blocked sales of certain Nvidia AI chips to China without specific licenses
- By August 2025, export licenses were granted for some Nvidia and AMD chips, but with a requirement that 15% of revenues be shared
- Nvidia developed a lower-capability chip called the H20 specifically for the Chinese market to comply with US export requirements
- Chinese regulators reportedly instructed domestic tech companies to avoid purchasing these specially designed chips
Despite Nvidia CEO Jensen Huang's personal lobbying efforts in Washington and a trip to China earlier this year, sales have remained stalled amid security scrutiny from both nations.
Nvidia's China Strategy: Planning for Absence
Huang revealed that Nvidia's current financial forecasts completely exclude the Chinese market. "All of Nvidia's financial forecasts assume China will remain out of the picture," he told Citadel Securities.
The CEO expressed hope for eventual policy changes, noting: "If anything happens in China, which I hope it will, it'll be a bonus. But it's a large market. China is the second largest computer market in the world. It is a vibrant ecosystem. I think it's a mistake for the United States to not participate."
Huang concluded with cautious optimism about potential policy shifts: "So hopefully we'll continue to explain and inform and hold out hope for a change in policy."
The Nvidia leadership's warnings highlight the complex interplay between national security concerns, economic interests, and technological competition in the global semiconductor industry. As Chinese competitors gain momentum with reduced American presence, the long-term implications for US technological leadership remain uncertain.
