Nvidia Corp. (NVDA) CEO Jensen Huang has a message for Washington: take China seriously. Not panic. Not ban everything. Just don't underestimate the country that can build pretty much anything at enormous scale.

Huang made the remarks during an interview with Yahoo Finance journalist Deirdre Bosa on the sidelines of Nvidia's GTC Berlin conference on Wednesday. Asked about reports that DeepSeek and Huawei are working together on chip designs, Huang said the U.S. should always take China "seriously" as both a manufacturing powerhouse and a technology competitor.

"If there's one country that could manufacture things at scale," Huang said, it is China. He praised Beijing's capacity to produce chips, open AI models, and even AI researchers at enormous scale.

"We've got to recognize that we have very, very serious competition," he said.

That said, Huang isn't waving a white flag. He added that American frontier laboratories, computing systems, and infrastructure remain the strongest in the world. He also noted that the U.S. government and policymakers have made it possible for American companies to operate in Africa and Central Asia, and said he'd like to compete in Brazil, Egypt, and other markets.

China's AI Push Pressures Nvidia

The warning lands as Huawei gains ground in China's AI accelerator market. An IDC analysis earlier this month found Nvidia held 34% of that market during the first half of 2026, compared with 28% for Huawei. Nvidia shipped 678,000 accelerators in China during that period, but its shipments fell 44% from the same period a year earlier, according to the report.

Huang has previously urged the U.S. to embrace China's AI models rather than ban them, calling the technology "excellent" and arguing that open-source models can expand AI adoption without threatening closed-model providers such as OpenAI and Anthropic. He also dismissed concerns that China could use these models to undermine U.S. companies, saying there was "Zero possibility" of Chinese AI driving American firms out of the market.

Not everyone sees it the same way. Former Google CEO Eric Schmidt said in a podcast interview that China trails the U.S. in AI by about six months but could still prevail because its products are offered free. He argued that China's low-cost and free AI models, along with open-weight systems, could gain traction in developing economies that cannot afford expensive Western alternatives.

Price Action: Year to date, Nvidia stock has surged 15.78%, according to market data. On Thursday, the stock was trading 2.73% lower at $215.92.