Huawei is reportedly facing a considerable challenge in terms of high-end chips resources for smartphones. Its U.S. sanction continues to take a toll on the beleaguered Chinese multinational technology company. The implications might result in Huawei having limited options to secure its future supply.
Fresh from being hailed as the world’s leading smartphone maker, and beating out Samsung and Apple, Huawei’s inability to acquire cutting-edge chips could immediately boot them out of contention. It also means it could wipe out multi-billion dollar sales for the company.
It can be recalled that Huawei was included in the “blacklist” in May last year by the U.S. government. A Temporary General License (TGL) was granted by American authorities to allow the technology giant to operate in the U.S. soil. The period of license expired four days ago.
A handful of consumers worldwide were already switching brands as the phones don’t carry popular apps in the U.S.
It took another major blow to its hardware supply chain as they are set to lose the resources next month, putting Huawei’s situation hanging in limbo.
“This is a very big loss for us,” Yu said on Friday, according to the Associated Press and multiple local media reports. Huawei declined to comment on the stories.
“This year may be the last generation of Huawei Kirin high-end chips,” he added, saying the company has “no chips and no supply.”
Huawei is in a league of a few companies, which also includes Samsung and Apple, to have the capacity to design their smartphone using their developed chips. A significant key that catapulted the Chinese technology company to be on top of the global smartphone market.
“This new rule will impact the expansion, maintenance, and continuous operations of networks worth hundreds of billions of dollars that we have rolled out in more than 170 countries,” according to a statement from Huawei.
HiSilicon, being Huawei’s chipmaking subsidiary, designs Kirin chips, and contracts Taiwan Semiconductor Manufacturing Company (TSMC) for the finished product. This year, the U.S. government, led by President Donald Trump’s initiative, banned any semiconductor manufacturer using U.S. technology from supplying Huawei, unless they were granted a license. TSMC, which is a non-US subsidiary, is included in the restriction.
“To attack a leading company from another country, the U.S. government has intentionally turned its back on the interests of Huawei’s customers and consumers. This goes against the U.S. government’s claim that it is motivated by network security.”Huawei’s media statement