The US has completed Huawei’s Kirin chips

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Before it was sanctioned by the United States, Huawei was the leader in smartphones. And like Apple or Samsung, it was even able to design its own processors for smartphones through its subsidiary HiSilicon. But Huawei’s mistake is that it only designed the Kirin chips for its devices, while the manufacturing was entrusted to a service provider: TSMC.

And when Washington tightened its sanctions in 2020, Huawei was no longer able to source Kirin chips from this supplier. Indeed, these new sanctions no longer affect only American companies, but also non-American companies that use American technologies. And because of this, TSMC was no longer able to trade with Huawei (unless it gets a special permit).

Has Huawei exhausted its stock of Kirin chips?

But despite these sanctions, it would seem that the end of Huawei chips was not immediate. In an article published this week, the South China Morning Post relays data from the company Counterpoint Research indicating that HiSilicon, the subsidiary of Huawei, still had a market share of 0.4% in smartphone processors, in the second quarter of 2022. However, in the third quarter, this market share would have fallen to zero. But how is this possible? It has been a long time since Huawei has been able to source the Kirin chip for its smartphones. Nevertheless, before the entry into force of the sanctions in 2020, the manufacturer would have built up a certain stock.

And if HiSilicon’s market share has fallen to zero today, it’s because Huawei would have ended up exhausting all the stock it had built up at the time. “Based on our verifications and sales data, Huawei has completed its inventory of HiSilicon chipsets,” Counterpoint Research says, according to the SCMP article. It is not known which models produced by Huawei still use these chip stocks made in 2020. But in any case, for its recent and high-end models, Huawei already uses chips provided by the Qualcomm company.

Indeed, the American company obtained a permit from Washington to sell 4G chips, but not 5G chips, to Huawei. It is for this reason that Huawei’s latest flagship uses a restricted version of the Snapdragon 8 gen 1 which only offers 4G. Moreover, the fact that its recent smartphones do not have access to 5G is one of Huawei’s main handicaps.

What alternatives for Huawei?

Currently, it is rumored that Huawei is looking for a solution to be able to equip its smartphones with 5G chips again. And one of the solutions considered would be to use less advanced technologies, which Chinese companies would be able to exploit, to restart the production of Kirin processors for Huawei smartphones.

Nevertheless, as the use of these less advanced technologies could affect the performance of smartphones, another solution would be considered. Huawei could continue to sell smartphones limited to 4G, but it could sell these smartphones with shells equipped with 5G modems in order to circumvent American sanctions.

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