Nvidia(US:NVDA) Xin Lang Cai Jing·2025-08-10 06:29Core Viewpoint - Nvidia, once holding a 95% market share in China's AI chip market, is now facing significant challenges due to technological blockades, domestic alternatives, and a trust crisis, which may lead to a complete overhaul of its market position in China within two years [1]. Group 1: Impact of U.S. Export Controls - The U.S. government's export control policies initiated Nvidia's troubles, with the U.S. Department of Commerce blacklisting Nvidia's high-performance H20 chip in 2023, prohibiting exports to China [3]. - This policy resulted in Nvidia losing major clients like Tencent and Alibaba, accumulating $4.5 billion in inventory, and ultimately writing down $5.5 billion in losses [3]. - Although the U.S. government relaxed restrictions on H20 chip exports in July 2025, the Chinese market has not welcomed Nvidia's products back [3]. Group 2: Rise of Domestic Alternatives - Over the past two years, Chinese companies have accelerated the development of domestic alternative chips to reduce reliance on Nvidia, with Huawei's Ascend chip surpassing Nvidia's H20 in computing power and addressing chip security issues through "密态计算" technology [6]. - This technology has eliminated backdoor risks, making it the preferred solution in government and financial sectors, resulting in over one million orders [6]. - Chinese automotive companies have also made significant strides in chip development, with firms like Xpeng and NIO integrating self-developed chips into their latest models, while BYD, GAC, and FAW are rapidly advancing in chip R&D and production [6]. Group 3: Security Concerns and Public Trust - In July, Chinese engineers discovered hidden interfaces and modules in the H20 chip capable of remote power control, positioning, and forced shutdown, raising widespread public concerns about chip security [8]. - This discovery led to the National Internet Information Office of China summoning Nvidia for clarification regarding the security risks associated with the H20 chip [8]. - Nvidia's response, claiming these features were merely "user-managed diagnostic functions," failed to alleviate market concerns, as the domestic AI chip localization rate reached 40%, indicating a near parity with imported chips [9]. Group 4: Future Outlook - The future landscape suggests that China will transition from being a "follower" to a "rule-maker," fully eliminating its dependence on Nvidia [11]. - Nvidia's challenges in the Chinese market reflect not only technological competition but also the direct impact of geopolitical pressures, as U.S. export controls aimed at stifling China's technological advancement have inadvertently spurred domestic innovation [13]. - The rise of domestic chips poses a significant threat to Nvidia and may alter the competitive dynamics of the global chip industry, as China's chip sector enters a golden development period with maturing technology and improved market ecosystems [13].