Huawei says survival is the goal, as USA crackdown hammers business

Alonzo Simpson
September 27, 2020

Huawei claimed on Wednesday that Qualcomm had applied for a U.S. government license to sell its chips to the Chinese tech giant.

There's a lot of uncertainty around Huawei with the ban in place, which doesn't allow USA companies, or those who use United States hardware and software to trade with the company.

Huawei was willing to use Qualcomm chips in its smartphones should Qualcomm get a licence to sidestep the restrictions, Guo added.

Intel INTC.O has already received licences to supply certain products to Huawei, while China's Semiconductor Manufacturing International Corp 0981.HK , which uses US -origin machinery to produce chips for Huawei, has applied for a licence, Reuters has previously reported.

Huawei Technologies Co (華為), the telecom giant at the center of US-China tensions, yesterday said that it has "sufficient" inventory for its communications equipment business while it seeks out supplies of smartphone chips that have been cut off by a ban by US President Donald Trump's administration.

As a result, Huawei now designs its own smartphone chips, called Kirin, through its HiSilicon subsidiary.

The company has been facing mounting pressure from the USA, which last month further tightened restrictions to choke Huawei's access to commercially available chips.

The reason for such statements was the third wave of sanctions, within which, starting September 15, Taiwanese TSMC stopped producing Kirin processors for Huawei.

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It is reported that Qualcomm and SK Hynix have applied for licences to sell to Huawei.

The measures block sales of chips made using U.S. technology to the Chinese company.

Huawei is searching for new suppliers, with Mr Guo suggesting major chipmaker Qualcomm as a possible source - if it can get a licence from the United States to supply them.

"The U.S. ban brings tremendous trouble in operation and production", Guo said.

But firms such as Intel and Qualcomm may supply chips for Huawei in the future, according to media reports.

The measures by the United States implemented in both May and August are making it increasingly hard for Huawei to acquire chips (even if they are not designed specifically for Huawei), which in turn is threatening Huawei's position as the leading smartphone supplier in the world.

Huawei's first-half revenue grew 13% to 454 billion yuan despite the global backlash, the company said in July.

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