Huawei conceded it is trimming its U.S. job force, but not nearly to the extent some recent news reports have indicated.
AGL Media Group reported this week that the Chinese gear and smartphone vendor was “in the process of cutting its 180-person U.S. workforce in half,” citing an unnamed source. But Huawei said it was eliminating only 20 positions, or less than 2% of its jobs in America.
“These normal resourcing changes reflect the need to maintain a sustainable and profitable infrastructure business in the U.S. for the long term, while we continue to recruit in line with the needs of our overall U.S. business,” Huawei said in an emailed statement to FierceWireless. “Our commitment to customers is the highest priority, and we remain committed to serving and supporting all existing infrastructure and other customers. Our R&D, supply chain management and consumer business group operations in the U.S. are unaffected by these changes.”
Huawei continues to struggle to gain any significant foothold in the U.S. market due primarily to security concerns, however. A U.S. government report issued in 2012 labeled China-based network vendors Huawei and ZTE as security threats that could be used as backdoors for Chinese espionage. Both companies have repeatedly said the claims are without merit, but the report has largely blocked Huawei from selling equipment to the nation's tier-one wireless operators like Verizon and AT&T.
More recently, The New York Times reported in March that a previously unreported subpoena was sent to Huawei in December by the U.S. Treasury Department, signaling an expansion of an earlier probe into whether the company violated trade controls with Cuba, Sudan, Iran and Syria. The administrative document didn’t indicate Huawei is under criminal investigation but suggested the company might be suspected of violating American embargoes.
Huawei denied any wrongdoing, the Times reported at the time, saying it “has adhered to international conventions and all applicable laws and regulations” in the markets in which it does business.
The news followed a report earlier that ten members of Congress had urged Commerce Secretary Wilbur Ross to “investigate and unmask” a company believed to have flouted U.S. sanctions laws. The business, said to be a rival of ZTE, is identified only as “F7” in an internal ZTE document from 2011 posted on the Commerce Department’s website.
As The New York Times noted last year when ZTE’s internal document first came to light, the description of F7 aligns with Huawei, which the newspaper noted is “a company far larger and more politically sensitive” than ZTE. The legislators also highlighted the similarities between F7 and Huawei in their letter, Bloomberg reported.
The company’s headaches mounted earlier this year when a jury awarded $4.8 million to T-Mobile after finding that Huawei misappropriated the carrier’s trade secrets. That case centered on allegations that Huawei employees took pictures of and pieces from a smartphone-testing robot called “Tappy” that was developed by T-Mobile.
Similarly, the Chinese vendor has struggled mightily to garner support for its smartphones from U.S. carriers. Its latest flagship, the Honor 9, was released in Europe in June but Huawei has yet to announce any plans to release the phone in the United States.