American technology company Nvidia may face new challenges as the US plans to add more sanctions on trade with the Chinese tech giant Huawei. China is Nvidia’s second-largest trade partner with an annual revenue of $7111 million in 2022 alone and the Chinese company Huawei is an important customer of Nvidia.
According to Reuters, a draft report by the US government proposes to add more restrictions and sanctions on trade with Huawei. As per the draft report, the proposed 2023 amendment of (the Commerce Department’s) licensing will likely have a high economic impact on Nvidia.
Nvidia declined to comment on the matter and said that the company is in no position to comment on pending licenses. However, the company said that China was a very important market for the US semiconductor industry and the company would work globally with customers and partners to comply with all applicable export controls and meet market demand.
The US Department of Commerce did not provide an official comment on the report. A senior officer from the State Department said that the document was a preliminary draft prepared by an outside contractor and the government had still not reviewed or approved the contents of the report. He further added that the government had written and contracted multiple reports on this subject, based on different contingencies, which arrive at very different conclusions.
Though the draft is not approved by the government, it sheds light on the US government’s plan to impose additional sanctions on the Chinese technology conglomerate Huawei. Apart from Nvidia, it also mentioned the tech giant Qualcomm and its business with Huawei. However, the draft concluded that in the case of Qualcomm and Huawei, Huawei stood a chance to lose more than Qualcomm as it heavily relied on Qualcomm’s chips to power its smartphones.
In 2019, the Trump administration added Huawei to the infamous entity list. The current Biden administration has continued with the restrictions and is increasing the curbs on Huawei and other Chinese tech companies. Under the US sanctions, exports, re-exports, and transfers to Huawei and its listed affiliates of any items subject to the EAR (including EAR99 items) without a license are restricted.
Trump administration imposed the trade ban on Huawei, citing national security concerns, which barred the company from using Android OS for its new smartphones, among other critical U.S.-origin technologies. The sanctions caused its smartphone sales to plummet. However, Huawei continues to generate revenue via its networking equipment and cloud divisions and is now exploring the lucrative electric vehicle (EV) sector.
Related:
- Huawei Accused of Tracking Visitors Via Security Badges at MWC 2023, Company Responds
- US Export Restrictions Could Hurt both Huawei and American Companies
- Huawei Disguised Its Chips With Tape and Coolers at MWC 2023
- MWC 2023: Best Products & Announcements From Day 1
(Source)
