Huawei Technologies founder and CEO Ren Zhengfei predicts U.S. sanctions could cut the telecom’s revenue by about U.S.$30 billion over the next two years. That’s the first time he’s quantified the hit from the Trump administration restrictions.
Sales at China’s largest technology company will likely remain stagnant at about U.S.$100 billion in 2019 and 2020, according to the executive, Bloomberg reported.
The Trump administration curbs will cut into a two-year lead Huawei built up over competitors like Nokia and Ericsson, Zhengfei said Monday during a panel discussion at company headquarters in Shenzhen.
“We didn’t expect the U.S. would hit our supply chain in such a wide way,” Ren said. “We didn’t expect the damage to be this serious.”
The U.S. accused Huawei of committing forced technology transfers and stealing trade secrets for the Chinese government. Last month, the U.S. placed Huawei on its “Entity List,” which effectively bars American companies from selling components to Huawei without government approval. The company has repeatedly denied the allegations.
On May 17, the U.S. blacklisted Huawei and cut it off from the U.S. software and components it needs to make its products. The result is rocking chipmakers from America to Europe, as the global supply chain comes under threat.
But Huawei has also said it will ramp up its own chip supply and find alternatives to keep its edge in smartphones and 5G. “We will be reborn by 2021,” Ren said.
June 18, 2019