NVIDIA guide doesn't assume any China data center compute revenue

NVIDIA guide doesn't assume any China data center compute revenue

NVIDIA Guidance Excludes China Data Center Compute Revenue Amid Export Controls

NVIDIA’s recent financial guidance for fiscal 2026 explicitly assumes zero revenue from China’s data center compute market, reflecting the company’s near-total exit from the region due to U.S. export restrictions and shifting demand dynamics. In Q2 2026, the company reported $46.7 billion in revenue, with data center sales reaching $41.1 billion, up 56% year-over-year, but explicitly noted no H20 chip shipments to China-based customers during the period. CEO Jensen Huang confirmed during a recent interview that Nvidia’s market share in China’s advanced AI accelerator segment has fallen to zero, down from 95% previously, as export controls and domestic alternatives have rendered the company’s products noncompliant in state-funded data centers.

The absence of China in Nvidia’s forecasts underscores a strategic recalibration. For Q3 2026, the company expects $54.0 billion in revenue, with no assumed H20 shipments to China, and maintains a non-GAAP gross margin forecast of 73.5%. Analysts highlight that China’s push for domestic semiconductor solutions, such as those from Huawei, has accelerated, further entrenching Nvidia’s exclusion from the market. This aligns with broader industry trends, as Chinese hyperscalers and AI labs increasingly adopt localized hardware.

Financially, China represented 20–25% of Nvidia’s data center revenue in prior periods, a segment now dominated by demand from U.S. and global cloud providers. Despite this loss, Nvidia has bolstered shareholder returns, repurchasing $24.3 billion of stock in the first half of 2026 and authorizing an additional $60.0 billion in buybacks. The company remains focused on expanding its AI infrastructure leadership through products like the Blackwell platform, which saw record demand in Q2.

For investors, Nvidia’s guidance signals a pivot away from China, emphasizing resilience in other markets. While the company has not ruled out a return to China, current forecasts assume no material contribution from the region, reflecting both regulatory and competitive realities. This strategic clarity may help differentiate Nvidia in a fragmented AI semiconductor landscape.

Tom's Hardware, Jensen: Nvidia's China AI GPU market share zero
NVIDIA, Financial Results for Second Quarter Fiscal 2026