Nvidia CEO Jensen Huang said overnight that U.S. chip export controls were "failed" and warned that restrictions would cause more damage to U.S. operations than China.

Huang said at a press conference at the AI ​​trade show in Taiwan that the policy has reduced AI chip leaders' market share from 95% to 50% and has inspired Beijing to make its own chips faster.

Huang's comments are subtle as the United States and China continue to fight tariffs and semiconductors.

China's Commerce Department responded to the Trump administration's recent CHIP policy changes on Monday, calling U.S. policies "beyond" and "bullying" and asking the White House to "correct its mistakes."

"The United States abuses export control measures, imposing unreasonable restrictions on Chinese chip products, and even interferes with the use of Chinese companies' domestically produced chips in China," the ministry said.

The White House canceled the tiered “AI proliferation rules” launched by former President Joe Biden in January and promised to replace it fully in the future.

NVIDIA is trapped in the middle, Huang maintains relations with both sides during the technical Cold War.

Last week in Saudi Arabia, President Donald Trump called Huang a "friend" and touted Nvidia's massive AI investment.

Huang accompanied Trump on a trip to the Middle East, an outstanding representative of the United States' global technological power. But Huang also maintained close ties with China and praised the country's technical capabilities.

NVIDIA is buying new space for its employees in Shanghai, although the company said it did not send any intellectual property or graphics processing unit designs here.

Huang told Washington lawmakers in April that China quickly gained a foundation in the United States in AI.

"China is behind us," Huang said. "We are very close. Remember, this is a long-term infinite race."

He also picked out Huawei's capabilities, which is reportedly developing its own advanced bargaining chips for rival Nvidia.

“They are incredible in terms of computing and networking technology, all of which can advance AI,” Huang said. “They have made tremendous progress over the past few years.”

Even in the relationship between the United States and China on rock basis, Huang told senior Chinese officials in April that his company would "serve the Chinese market."

NVIDIA's balanced game continues, reshaping chips to maintain compliance and cross business and political fault lines.

Huang's warning is obvious: If the United States does not rethink its approach, it may lose its Chinese market and its advantage in the global AI race.