Nvidia loses $1.15 trillion in 3 months as China tensions rattle Wall Street

On January 24, Nvidia closed with a staggering $3.49 trillion market cap. Just days later, it lost $600 billion in under two hours as DeepSeek’s surprise breakout sparked fresh doubts about runaway AI chip spending. Three months later, the bleeding hasn’t stopped—but now the pressure is coming from China.

It all began earlier this month when the U.S. government shut down one of Nvidia’s fastest-growing revenue streams: China. The new export restrictions wiped out what had become the company’s biggest international play, setting off billions in fallout.

On Tuesday, Nvidia said it would take a $5.5 billion hit this quarter after being forced to halt shipments of its H20 AI chips to China and other affected regions. Investors didn’t take it well—the stock dropped 6% in after-hours trading following the announcement.

That drop wasn’t a one-off. By Monday, Nvidia shares were down another 5.8%, closing at $95.60. The company’s market cap now stands at $2.34 trillion—down more than $1.15 trillion in just three months.

Nvidia’s China Problem Just Got Worse. Huawei’s Ready to Capitalize.

To slow the slide, Nvidia CEO Jensen Huang reportedly made a surprise visit to Beijing last week, meeting with trade officials while the company explores plans to expand chip production back home. But the clock may already be working against him.

On Monday, Reuters reported that Huawei is preparing to start mass shipments of its Ascend 910C chip to Chinese customers to fill Nvidia’s void. Some units have already gone out, and larger-scale deliveries are expected as early as next month.

The 910C is Huawei’s latest AI-focused GPU, built for both training and inference. It’s essentially two 910B chips fused with some clever engineering. The result? Around 800 teraflops of FP16 performance and 3.2 terabytes per second of memory bandwidth—roughly 80% of what Nvidia’s H100 delivers, which is plenty for Chinese firms looking to move away from U.S.-linked suppliers.

The chip is built using a 7nm process, relying mostly on Taiwan’s TSMC, with support from China’s SMIC. Huawei had stocked up on TSMC chips before sanctions kicked in, and now SMIC is scaling up its own production. Together, they’re fueling Huawei’s push to ship millions of units in 2025.

But Huawei isn’t just shipping silicon—it’s selling full-stack systems. Its CloudMatrix 384 clusters 384 of these GPUs into a single AI compute box that reportedly delivers 300 petaflops. For comparison, Nvidia’s high-end GB200 NVL72 delivers around 180. The tradeoff is higher energy usage, but with lower electricity costs and fewer chip options, most Chinese customers are taking that deal.

Earlier this month, the U.S. imposed fresh export restrictions requiring Nvidia to get licenses before shipping its H20 chip to China. The H20 had been Nvidia’s main offering for the region. Now it’s effectively sidelined. Companies like Baidu, Tencent, and ByteDance are left scrambling, and Huawei is already stepping in.

Huawei began sampling the 910C to major Chinese tech firms in late 2024 and is already fulfilling early orders. Analysts are taking notice. Paul Triolo of Albright Stonebridge Group said, “Huawei’s Ascend 910C GPU will now become the hardware of choice for Chinese AI model developers.” Nori Chiou of White Oak Capital added that the export rules are “effectively pushing Nvidia’s Chinese customers toward Huawei’s AI chips.”

Nvidia’s Grip Is Loosening in China

Nvidia’s global position isn’t under immediate threat, but the China story is shifting fast. After the latest restrictions, Nvidia shares slipped 3.1% in premarket trading. The company is taking a $5.5 billion charge tied to halted H20 sales, and CEO Jensen Huang recently admitted China revenue has been cut in half.

Meanwhile, Huawei is gaining ground. In a recent interview with the Financial Times, Huang acknowledged Huawei as a serious competitor.

China’s Push for Chip Independence

Huawei’s Ascend 910C sits at the heart of a broader push by China to reduce its dependence on foreign tech. With U.S. chips harder to come by, Chinese firms are ramping up local alternatives. Huawei says it’s improved production yields on its Ascend chips by 40% since last year and is aiming to ship 100,000 910Cs and 300,000 910Bs in 2025.

The software side is still a work in progress. Huawei’s ecosystem lags behind Nvidia’s CUDA platform, but it’s catching up. Its growing partnership with AI developers like DeepSeek could turn into a real challenge for Nvidia—especially if geopolitical pressure continues to mount.