Chinese telecom giant Huawei announced on October 16, 2019 that it has passed the 400,000 5G antennas mark, the fifth generation of mobile phones, in the world with 56 operators who have already started to roll out the new mobile network.
STEFAN WERMUTH | AFP | Getty Images
Huawei’s business will “inevitably be impacted” by a new U.S. rule that aims to limit chip exports to the Chinese technology company, a top executive said on Monday.
Washington’s latest rule requires foreign manufacturers using U.S. chipmaking gear to get a license before being allowed to sell semiconductors to Huawei.
Experts told CNBC that Washington’s latest regulation could deal a “big blow” to the Chinese technology giant as it would hit Taiwanese chipmaker TSMC, Huawei’s main source of chips for products such as smartphones and its networking gear. In addition, Huawei will struggle to find an alternative to TSMC to make the chips it requires, putting billions of dollars of revenue at risk.
“Our business will inevitably be impacted. In spite of that, as the challenges over the past year have helped us develop a thicker skin, we are confident about finding solutions soon,” said Guo Ping, Huawei’s current rotating chairman, without giving specific figures around the potential hit. His comments, in Mandarin and translated by a Huawei translator, were the first public comments from the Chinese technology giant since the new ruling was announced last Friday.
The executive said the company still hasn’t figured out a potential solution to the chip export rule and declined to give any financial forecasts.
“Survival is the key word for us at present,” he said.
In a media statement released Monday, Huawei said it “categorically opposes” the new U.S. rule.
“The U.S. is leveraging its own technological strengths to crush companies outside its own borders. This will only serve to undermine the trust international companies place in US technology and supply chains. Ultimately, this will harm US interests,” the statement read.
Guo used a speech at a Huawei summit on Monday to talk about the need for collaboration between countries, companies and industry bodies while taking a swipe at the U.S.
“The U.S. moves against leading tech companies in other counties in the long run will shake the country’s confidence in using American technology, escalate conflict in global industry and ultimately hurt the U.S.’s interests,” he said.
Huawei spent $18.7 billion on goods from U.S. suppliers last year, according to Guo, and “will continue to buy” from them if Washington allows.