The impact of the U.S. blacklisting is less than feared, and Huawei is fully prepared to deal with the restrictions for a long time to come. That was the message given to reporters at an event at the company’s HQ in Shenzhen on Friday [August 23]. Although, of course, the real audience was not the assembled media but the Trump administration—thousands of miles away in Washington—as the battle of wills continues.
The statements were made at a launch event for the company’s new Ascend 910 AI chip—intended to rival the likes of Qualcomm and Nvidia. “The Ascend 910 has more computing power than any other AI processor in the world,” the company said in a statement. And the backdrop is, of course, Huawei’s ongoing program to break its reliance on U.S. tech that is restricted under its blacklisting.
A further 90-day reprieve was formalised by the Commerce Department this week, but all signs (currently) point to a full lockdown in November, and an additional 46 Huawei “affiliates” have been added to the entity list this week, making the existing restrictions harder to deal with. The extension provides Huawei with three further months of (some level of) supply chain surety—time enough to launch its next smartphones and to continue development of its “Plan B.”
“We’re giving [customers] a little more time to wean themselves off [Huawei],” Commerce Secretary Wilbur Ross explained. “But no specific licenses are being granted for anything.” Adding later that “as we continue to urge consumers to transition away from Huawei’s products, we recognize that more time is necessary to prevent any disruption.”
Just ahead of the reprieve being announced, U.S. President Donald Trump had a blunt message for the Chinese giant—”we are not open to doing business with [Huawei],” the president said, “I don’t want to do business at all because it is a national security threat.”
And Huawei’s riposte at the launch event for the AI chip was equally blunt. “The 90-day reprieve has no value to Huawei,” company chairman Eric Xu told the media. “We are already used to living and working under the Entity List—we are ready to work and live under such a situation for a long time.”
And if that wasn’t frank enough, asked about the impact those restrictions are likely to have on business performance this year, Xu was just as blunt.
The impact, Xu told reporters, would not reach the levels feared, the $30 billion or so that company CEO Ren Zhengfei had reported could be wiped from the top line. “But you have to wait till our results in March,” Xu added when pressed.
The Ascend 910 was pre-announced late last year, and Huawei claims it offers market-leading performance in quickly crunching through masses of cloud data. And that’s what everyone wants right now. “Ascend 910 performs much better than we expected,” Xu claimed. “Without a doubt, it has more computing power than any other AI processor in the world—we have been making steady progress since we announced our AI strategy in October last year.”
Huawai has said that it “will continue investing in AI processors to deliver more abundant, affordable, and adaptable computing power that meets the needs of a broad range of scenarios,” citing autonomous vehicles as an example.
“Everything is moving forward according to plan,” Xu said, “from R&D to product launch. We promised a full-stack, all-scenario AI portfolio. And today we delivered.”
Huawei is balancing maintenance of corporate and consumer confidence, hedging its bets on where the U.S. blacklist actually ends up once trade talks conclude, the reality of a wholesale replacement of U.S. tech—notwithstanding that it may have little choice, and the media scrutiny currently applied to every statement.
Take the chip release event and bullish statements, the HarmonyOS launch and the Google Maps rival reports as part of the same PR program—the message is clear, but as ever the truth behind the scenes is harder to discern.
Time will tell.