Ming-Chi Kuo has been a reliable analyst when it comes to Apple but he has now shared his opinion about Huawei, which is currently the world’s leading smartphone brand, overtaking Samsung in Q2 2020.
He claims that the Chinese giant Huawei could exit the smartphone market if the conditions for the company worsens. The sanctions put on the company by the United States has been severely affecting the company’s business.
It all started in May last year when the U.S. President Donald Trump signed an executive order putting Huawei on “Entity List”, effectively banning the Chinese giant from using American technologies.
This led to Huawei getting banned from using Google’s Android operating system on its Huawei as well as Honor-branded devices. Recently, the U.S. government tightened restrictions on Huawei as well as its subsidiaries.
With the new restrictions, Huawei has been banned from using American companies or technologies for semiconductors. This means that the company can’t manufacture its own Kirin-branded chipsets with the help of American companies or the companies that use American technologies.
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TSMC, the contact manufacturer of Huawei for the HiSilicon Kirin chipsets, stopped taking new orders from the company. Given that Qualcomm is based in the United States, it is also out of the question. MediaTek has already applied for a special license to do business with Huawei, but it’s unlikely to get it.
According to Kuo (via MyFixGuide), even if Huawei somehow manages to source components, the competitiveness and market share of the company is bound to suffer. He adds that in the best-case scenario, its market share declines, and in the worst-case scenarios, the company exits the smartphone market.
It is being reported that if the restrictions are not eased, then Huawei could be losing around 30 percent of the market share. With Huawei’s future on the line, companies like Apple, OPPO, Vivo, and Xiaomi are in a beneficial position in the local market.
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