Trump waffles, lets U.S. firms sell products to Huawei

Trump’s latest comment caused Huawei’s stock to jump this morning. (White House)

President Donald Trump said over the weekend that U.S. companies can sell high tech equipment to Huawei, adding more confusion to an export ban that Trump first placed against Huawei in May. Trump said the ban was unfair to U.S. suppliers. However, he was unclear as to which U.S. firms could resume supplying Huawei and which specific products they could resume selling.

Following a meeting with Chinese premier Xi Jinping at the G20 summit this weekend, Trump said, “U.S. companies can sell their equipment to Huawei. We’re talking about equipment where there’s no great national security problem with it.”

RELATED: Trump to ban U.S. carriers from using network gear posing security risk: Reuters

Sponsored by Qualcomm

Propelling 5G forward – a closer look at 3GPP Release 16

Tuesday, July 7, 2020 | 12pm ET | 9am PT
Join this webinar to stay up to date on the status of 3GPP, track our journey so far on 5G commercialization, understand how 3GPP Release 16 enhances the foundational aspects of 5G and learn about the upcoming system innovations that will expand the reach of 5G

Trump’s latest comment caused Huawei’s stock to jump this morning, along with the stocks of some Asian companies that supply the Chinese telecom vendor, reported Reuters.

Some American companies that supply Huawei also rallied this morning, including Intel, Qualcomm and Micron. In fact, these same companies had already reportedly found workarounds to comply with government export restrictions, and they had resumed shipments to the Chinese tech giant in June.

Speaking on an earnings call with investors last week, Micron CEO Sanjay Mehrotra said, “There is considerable ongoing uncertainty surrounding the Huawei situation.” Micron had resumed some shipments to Huawei after determining certain products were not subject to the government’s export restrictions.

RELATED: U.S. tech companies find workaround of Huawei export ban: report

Trump isn’t the only one waffling. For months, Huawei insisted that the U.S. ban wasn’t hurting its business. In its first earnings report this year the company reported a net profit of close to $9 billion in 2018, which was an increase of 25% compared to the previous year. Huawei said its revenue for the year increased by almost 20% to $105 billion, which was its fastest growth in two years. But, in June, Huawei CEO and founder Ren Zhengfei said his company had reduced its revenue forecast for 2019, and that Huawei's revenue would be down 30%, coming in at an estimated $100 billion. He estimated that Huawei would suffer some $30 billion in lost revenue over the next two years.


Suggested Articles

Fixed wireless broadband provider Starry reports having its best quarter ever in Q1, but the COVID-19 crisis is having an impact.

Since the beginning of the pandemic, Viasat has been working to manage the increased demands on its network to ensure the best customer experience.

Laurent Therivel is replacing long-time CEO Kenneth Meyers, effective July 1.