The move is a win for both American officials worried about China’s rapidly advancing technology and the companies’ rivals, including AMD
The Biden administration has increased its restrictions on sales of U.S. technology to Huawei Technologies as China’s leading technology firm draws more scrutiny. The move, first reported by The Financial Times on Tuesday, will curb some U.S. companies from selling chips to Huawei that are used in smartphones and laptops. The Department of Commerce confirmed to multiple media outlets that “certain licenses to export to Huawei” had been revoked.
The move is a win for both American officials worried about China’s rapidly advancing technology and those companies’ rivals, including Advanced Micro Devices (AMD $AMD).
AMD and other skeptics of Intel’s business relationship with Huawei have reportedly tried to stop Intel from selling its chips to the Shenzhen-based firm. AMD argued that Intel’s license was unfair because it had not received its own license to sell advances chips to Huawei, despite attempts to get one from the Biden administration.
Intel’s license was issued by former President Donald Trump’s administration in September 2020, after Huawei was put on a trade blacklist the previous year along with more than 275 other Chinese firms. American companies are banned from selling to companies on the list without special permission.
Some Republican lawmakers in recent months have been pressuring the Biden administration to take a tougher stance on China, specifically concerning Huawei’s advancements. The company relies heavily on Intel’s chips to power its laptops. More than 90% of Huawei’s sales during the first half of 2023 contained Intel’s processors, Reuters reported in March.
“This was the right decision, but the license never should have been granted in the first place,” Sen. Marco Rubio, a Florida Republican, said in a statement.
Since it received a license in 2020, Qualcomm has sold 4G chips to Huawei. The company also licenses its portfolio of 5G technologies to the Chinese firm. That deal expires in Qualcomm’s early fiscal-year 2025 and it has started negotiations to renew the deal, according to a regulatory filing earlier this month.
Qualcomm earlier this month said it expects its operations to be impacted by competitors, including Huawei, developing their own chips. Huawei last year began using a 5G chip designed by its HiSilicon unit, although it has drawn intense scrutiny and allegations that its manufacturing violates U.S. sanctions.
“While we have continued to sell integrated circuit products to Huawei under our licenses, we do not expect to receive product revenues from Huawei beyond the current calendar year,” Qualcomm added in the regulatory filing.
-Britney Nguyen contributed to this article.
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.
