China wants to break its dependence on Nvidia, but its AI companies are buying more of its chips

China's reliance on Nvidia persists

China wants to break its dependence on Nvidia, but its AI companies are buying more of its chips. The trend underlines the challenge Beijing faces in reducing the country's reliance on the US chipmaker, even as it pushes for homegrown processors. The development was reported on October 13, 2026.

Export restrictions and domestic push

US export restrictions have limited China's access to advanced chips. At the same time, Beijing is promoting the development of domestic processors as part of its broader push for self-sufficiency. Despite these efforts, purchases of Nvidia hardware by Chinese firms continue to grow.

Computing power crunch

According to the report, Chinese technology giants are struggling to find enough computing power to support their rapidly expanding AI ambitions. The combination of surging demand for AI capabilities and constrained supply of advanced chips appears to be driving companies toward Nvidia products, even as the government encourages the use of homegrown alternatives.

Implications for China's AI sector

The continued reliance on Nvidia highlights the gap between China's AI ambitions and the current state of its domestic chip industry. For Chinese technology giants, securing enough computing power has become a pressing concern as they race to develop and deploy AI services, and Nvidia's chips remain central to those plans.

Sources: Moneycontrol · Financial Times · Yahoo Finance