Huawei to Cease Manufacturing of Flagship Chipsets As US Pressure Mounts, Says Chinese Media

The Chinese tech giant is set to discontinue the production of its flagship Kirin chipsets from September 15

As the consequences of US pressure on Huawei Technologies Co worsens, the Chinese tech giant is set to discontinue the production of its flagship Kirin chipsets from next month, a report by Caixin on Saturday said.

Richard Yu, CEO of Huawei's Consumer Business Unit said that pressure from the US on Huawei's suppliers has made it difficult for the company's HiSilicon chip division to continue producing chipsets.

"From Sept. 15 onward, our flagship Kirin processors cannot be produced. Our AI-powered chips also cannot be processed. This is a huge loss for us," Yu was quoted as saying by Caixin at the launch of Huawei's Mate 40 handset.

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Washington's Growing Pressure

With US-China relations at their worst in decades, Washington is pressing governments around to world to squeeze Huawei out, arguing it would hand over data to the Chinese government for spying. Huawei denies it spies for China.

The United States is also seeking the extradition from Canada of Huawei's chief financial officer, Meng Wanzhou, on charges of bank fraud. In May the US Commerce Department issued orders that required suppliers of software and manufacturing equipment to refrain from doing business with Huawei without first obtaining a license.

Dependence on US Firms for Software

Huawei's HiSilicon division relies on software from US companies such as Cadence Design Systems Inc or Synopsys Inc to design its chips and it outsources the production to Taiwan Semiconductor Manufacturing Co (TSMC), which uses equipment from US companies.

Huawei declined to comment on the Caixin report. TSMC, Cadence and Synopsys did not immediately respond to email requests for comment. HiSilicon produces a wide range of chips including its line of Kirin processors, which power only Huawei smartphones and are the only Chinese processors that can rival those from Qualcomm in quality.

"Huawei began exploring the chip sector over 10 years ago, starting from hugely lagging behind, to slightly lagging behind, to catching up, and then to a leader," Yu was quoted as saying. "We invested massive resources for R&D, and went through a difficult process."

(With inputs from agencies)