Intel has successfully defended against an attempt to block its chip sales worth hundreds of millions of dollars to Huawei, as per sources familiar with the matter. This grants the major chipmaker more time to continue supplying the heavily sanctioned Chinese telecoms company.
There has been persistent pressure on US President Joe Biden to revoke a license, initially issued by the Trump administration, permitting Intel to supply advanced central processors to Huawei for use in laptops.
The pressure stemmed notably from Intel’s competitor, Advanced Micro Devices (AMD), which argued against the perceived unfairness of not receiving a similar license to sell chips to Huawei. Additionally, there were concerns raised by China hawks aiming to halt all sales to the Chinese firm.
The fact that Intel retained its license while a rival did not underscores the uneven and uncertain landscape for companies as the US endeavors to restrict Beijing’s access to sophisticated American technology, particularly to companies like Huawei that face heavy sanctions.
This situation has allowed Huawei to maintain a small but expanding share of the global laptop market, while AMD missed out on significant sales to the Chinese firm, according to data.
Huawei’s reliance on Intel chips for its laptops remains predominant, with the majority of CPUs used in Huawei laptops still sourced from Intel. Any further limitations on Intel’s supply would pose significant challenges for Huawei’s laptop offerings, according to industry analysts.
Neither Intel, Huawei, the Commerce Department, nor the White House offered comments on the matter, while AMD did not respond to inquiries.
The Chinese Embassy in Washington criticized the restrictions on Huawei as economic bullying and urged the US to refrain from stretching the concept of national security to suppress Chinese companies.
Huawei’s addition to the trade restriction list by the Trump administration in 2019 over alleged sanctions violations has escalated the technology rivalry between the US and China. Although being added to the list typically prohibits US suppliers from selling to the targeted company, certain exceptions were granted to some US Huawei suppliers, including Intel, just before the end of Trump’s presidency.
AMD sought a license to sell similar chips to Huawei in early 2021 but did not receive a response to its application.
The discrepancy in licensing decisions had an immediate impact on CPU chip sales to Huawei, resulting in a significant revenue gap between Intel and AMD.
Efforts to revoke licenses seemed promising last year but were ultimately shelved by the Commerce Department without explanation, possibly as part of broader efforts to reset relations with Beijing.
Intel’s license is expected to expire later this year and is unlikely to be renewed, while Huawei continues to heavily rely on Intel chips for its laptops, as indicated by its website.
In China, Huawei’s market share in laptop sales has been steadily growing, positioning it as the third-largest laptop manufacturer in the country.
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