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US further restricts chip sales to Huawei by revoking export licenses

Huawei MateBook X

The US government has revoked some licenses that allowed American chip companies to export semiconductors to Huawei. This reflects an ongoing effort by the Biden administration to limit the Chinese tech company's access to key technologies.

The Commerce Department (via CNBC) said that it is continually assessing how export controls can protect national security and how the geopolitical landscape and the technology industry are evolving. As part of that review, the US has revoked certain licenses for the sale of chips and related technologies to Huawei.

While the Commerce Department did not specify which licenses or companies were affected, this is the latest move by the Biden administration to crack down on Huawei.

As part of this process, as we have done in the past, we sometimes revoke export licenses. But we can confirm that we have revoked certain licenses for exports to Huawei

It also comes after former President Trump placed Huawei on a trade blacklist in 2019, citing security concerns. That blacklist prohibited US companies from selling technology, such as 5G network equipment, to Huawei without proper authorization.

In 2020, the US tightened those restrictions by requiring foreign firms using American manufacturing equipment to obtain a license before exporting semiconductors to Huawei. Now, by revoking some previous licenses, the administration is signaling that it does not want Huawei to have access to even limited supplies of US-made or US-connected chips. This will put further pressure on the Chinese technology company, which has developed its own chips in response to sanctions but still relies on foreign suppliers for some components.

The license revocation will also affect chipmakers that supply Huawei. Companies like Intel and Qualcomm, which still sell some chips to Huawei under license, have warned that their revenues could take a bigger hit as Huawei ramps up internal production and captures more of the domestic Chinese market with self-sufficient devices.

On the other hand, Apple is witnessing a substantial decrease in iPhone shipments in China, with a 33% reduction in February from the previous year. The company's struggle began with Huawei's resurgence in the premium smartphones like Mate 60 Pro.

Sources: CNBC, Bloomberg

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