Huawei, the Chinese technology giant, stated on Friday about the impact of US trade restrictions on their smartphone business. They now think that the effect will be less than what they have feared initially. However, the barriers can still push their revenue lower by about $10 billion in the ongoing year. The $100 billion business of the Chinese technology giant got hit hard by Washington’s Entity List since mid-May this year.
In the first assessment of the impact of the restrictions upon Huawei smartphone market, the CEO said in July that the blacklisting would hit their revenue by $30 billion and that would affect the market growth in 2019.
“It seems it is going to be a little less than that. But you have to wait till our results in March,” said Eric Xu, Huawei’s deputy chairman at a news conference. “But a [sales] reduction of more than $10 billion could happen,” he added.
“We are open to discussing partnerships with AI chipset development companies, so there are chipsets of various kinds that could be used in Huawei products. So, positioning our chipset business as a standalone is a scenario that is not going to happen.”
Huawei stated that due to such restrictions, they are unable to work with US chip designers including Cadence Design Systems Inc and Synopsys. However, they have alternatives to work on. But as a temporary relief, Washington extended the 90 days reprieve that will allow Huawei to buy from US firms so that they can supply to the existing customers. But after that, more than 40 of Huawei’s units will be added to its economic blacklist.