Why Jensen Huang says Huawei gaining AI power could hurt the US

Jensen Huang’s scary prediction

Jensen Huang, Nvidia’s CEO, just gave a wake-up call about America’s lead in artificial intelligence. He warned that if DeepSeek’s next-generation AI models come out first on Huawei hardware or become optimized around Huawei’s AI stack, it would be a “horrible outcome” for the United States.

Huang is not known for sounding alarms casually. NVIDIA’s GPUs and CUDA software remain central to much of today’s AI infrastructure, so its warning about a Huawei-DeepSeek shift is worth paying close attention to.

A new tech stack threat

Here’s what keeps Jensen Huang up at night: future AI models being built around Chinese technology instead of America’s. He explained that if DeepSeek optimizes its software to run best on Huawei chips, the whole AI world could shift toward Chinese standards.

Think of it like two different phone chargers. Once everyone starts using one type, the other becomes useless. Huang fears America’s AI charger could lose out if China sets its own rules. That’s why he’s sounding the alarm so loudly now.

China’s secret weapons

Even if China’s chips aren’t as good as America’s, Jensen Huang says they can still catch up. How? Two big reasons: energy and brainpower. China has massive amounts of cheap electricity to run AI computers nonstop. And they have a huge army of brilliant AI researchers.

Huang called China’s number of science and math experts a national treasure. He says America should not underestimate what a country with abundant energy and smart people can do. Even with weaker chips, China can keep improving and eventually close the gap.

Nvidia’s share fell to zero

Remember when Nvidia basically owned China’s AI chip market? Jensen Huang says that’s over. He told investors that Nvidia went from about 95% market share in China all the way down to 0%. Yes, zero percent. That’s a stunning fall for a company that was on top of the world just a couple of years ago.

What happened? US export rules blocked Nvidia from selling its best chips to China. Now, Chinese companies have nowhere to go but local makers like Huawei. Huang admits the policy has “largely backfired” because it pushed China to build its own chips instead of buying American ones.

Fun fact: Jensen Huang expressed disbelief at the policy impact, saying, ‘I can’t imagine any policymaker thinking that that’s a good idea,’ when announcing Nvidia’s complete loss of its China AI GPU market share.

Export controls backfired

Jensen Huang didn’t mince words about US export policy. He said that giving up an entire market the size of China does not make a lot of strategic sense. In plain English, he thinks the restrictions hurt American companies more than they hurt China. Huawei is now filling the gap that Nvidia left behind.

Huang wants the government to rethink its approach. He argues that having American chip companies selling in China actually helps the US stay ahead. Without that presence, China speeds up its own research. So the rules meant to slow down China may end up doing the opposite.

Fun fact: When the H20 export ban was announced in April 2025, Nvidia’s stock fell over 6% in after-hours trading, and the company recorded a massive $5.5 billion hit tied to inventory and purchase commitments.

Huawei is formidable

Don’t let the name fool you. Huawei isn’t just a phone company anymore. Jensen Huang called Huawei one of the most formidable technology companies in the world. He pointed out that they’re incredible at computing and networking, which are the building blocks of AI. And they’ve made enormous progress in just a few years.

Huawei is expected to take the top spot in China’s AI chip market this year. They’re projected to sell around $12 billion worth of AI chips in 2026. That′s up from $7.5 billion the year before. While Nvidia steps back, Huawei is stepping up.

DeepSeek’s V4 sparks worry

DeepSeek’s V4 has already raised fresh concerns. Reuters reported that DeepSeek previewed its V4 series in April 2026 and that the architecture was adapted for Huawei Ascend chips, with Huawei saying the models were supported on Ascend 950-based supernode clusters.

Jensen Huang has warned that a major AI model coming out first on Huawei hardware would be a “horrible outcome” for the United States. A senior U.S. official also alleged to Reuters that DeepSeek’s latest model had been trained on Nvidia Blackwell chips despite U.S. export restrictions, but that remains an allegation rather than a confirmed legal finding.

China is not behind now

Here’s something that might surprise you. Jensen Huang told reporters that China is not behind the United States in artificial intelligence. He said, ” We are very close”, and reminded everyone that AI is a long-term, infinite race. That’s a humble admission from the CEO of America’s AI champion.

Huang sees China right on America’s tail. And while Nvidia still leads globally, China has homegrown talent and government support on its side. He believes US policy should focus on making American companies more competitive, not just blocking China. In a race this close, small moves matter a lot.

A $5.5 billion hit

The US restrictions on AI chips aren’t just talk. They hit Nvidia’s wallet hard. When the Trump administration blocked Nvidia’s H20 chips from being sold to China without a license, Nvidia had to take a $5.5 billion charge. That’s real money, and it came right out of their bottom line.

Jensen Huang called for policies that stay with the times instead of fixed rules that don’t adapt. He argues that a dynamic approach would serve America better. Because while Nvidia loses billions, Huawei keeps growing. And that $5.5 billion could have been invested in more US research and jobs.

AI talent is China’s treasure

What makes China so dangerous in AI? According to Jensen Huang, it’s their people. He said China has an extraordinary number of AI researchers, calling them one of the country’s national treasures. With so many bright minds working on the same problem, progress happens fast. You can’t put export controls on brainpower.

America has great researchers, too, but China is graduating tons of science and math experts every year. Combined with cheap energy and a government that prioritizes AI, they form a powerful engine. Huang wants Americans to understand that you can’t just ban your way to victory.

The CUDA moat still holds

There’s one area where America still has a big edge: software. NVIDIA’s CUDA platform is like the operating system for AI chips. It’s what makes their hardware so easy to use. Chinese companies haven’t fully cracked that code yet. Jensen Huang calls this the “CUDA moat,” and it’s kept Nvidia ahead even as sales in China drop.

But moats can be crossed. China’s chip makers like Huawei are working hard to build their own software stacks. Once they succeed, Nvidia’s lock on the market weakens further. Huang knows this. That’s why he keeps pushing for American companies to stay in the game.

Congress wants more blocks

While Jensen Huang asks for cooperation, some US lawmakers are going the other way. Recently, they accused China of buying what it can and stealing what it cannot. Now they’re calling for DeepSeek, Moonshot AI, and MiniMax to be put on the entity list.

Huang warns that fear-driven policies could backfire. Slowing down Chinese companies might feel good, but it also encourages them to build completely independent systems. Once they do, America loses all influence over their standards. The CEO believes long-term leadership comes from making the US ecosystem so good that everyone wants to use it.

Want to see where Jensen Huang believes Nvidia’s biggest opportunities are opening up next? Take a look at his comments on Europe; they add another layer to the strategy.

The race is far from over

So should Americans be scared? Jensen Huang says no, but we should be realistic. He believes the US can still win, but not by hiding behind walls. America needs to invest, innovate, and compete. China has energy, talent, and determination. The US has its own strengths, including companies like Nvidia that still lead the world.

The bottom line: this is a marathon, not a sprint. Huang’s warning is a favor to America. He’s saying, Wake up. If the US plays its cards right, by building better chips, smarter policies, and stronger partnerships, it can stay ahead. But if we ignore the threat, Huawei and DeepSeek might write the future of AI.

Want to see how Nvidia is trying to stay ahead in that race? Take a look at the company’s latest AI breakthrough from its mega conference; it shows where the focus is now.

What’s your take, should the US tighten chip rules further or focus on out-innovating China? Drop a comment below and hit like if this slideshow opened your eyes.

This slideshow was made with AI assistance and human editing.

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