Huawei Faces Major Challenge as US Revokes 4G Chip Licenses: Implications for both Companies and National Security Concerns

The United States has announced the revocation of licenses for companies such as Intel and Qualcomm to supply 4G chips to Chinese telecommunications equipment maker Huawei Technologies. This move comes after Huawei was added to a US list of trade restrictions in 2019, amid concerns about technology being used for espionage and military strength.

According to three sources, the Ministry of Trade confirmed the withdrawal of certain export licenses to Huawei without specifying which ones were involved. This decision by the Department of Commerce has been hailed by some as a move to strengthen national security, protect American innovation, and limit China’s technological capabilities.

The withdrawal of licenses could pose challenges for both Huawei and American suppliers. Intel has been facing weak demand for its chips, and Qualcomm, which sold older 4G mobile chips to Huawei under a 2020 license, does not expect revenue from chip sales to the Chinese company starting next year. The agreement on patent rights governing the use of Qualcomm’s 5G technologies with Huawei is set to expire in 2025, with discussions ongoing for a possible extension.

Critics argue that the permits allowed Huawei to recover from the impact of American sanctions, especially following the launch of a new phone with a sophisticated chip from a Chinese manufacturer. Despite these challenges, Huawei’s sales surged in the first six weeks of this year, demonstrating their resilience in the face of restrictions and licensing changes.