Chinese consumers are rushing to buy smartphones from Huawei Technologies Co (華為) featuring its high-end Kirin chips, fearing that curbs on the firm’s access to US technology would soon cut off production of its premium handsets.
Phone vendors in Huaqiangbei in Shenzhen, the world’s largest electronics market, said that prices for new and used Huawei phones had risen steadily over the past month by about 400 to 500 yuan (US$59.12 to US$73.90) on average.
The Porsche design model of Huawei’s flagship Mate 30 was selling for 14,000 yuan, from 10,000 yuan in January, one vendor said.
Photo: Reuters
The phone was available at a similar price on online marketplace Taobao (淘寶).
The US government last year moved to prevent most US companies from conducting business with Huawei, saying that the world’s biggest maker of mobile telecommunications equipment and smartphones was ultimately answerable to the Chinese government.
Huawei has repeatedly denied being a national security risk.
Last month, the US further tightened restrictions to choke the firm’s access to commercially available chips, prompting Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to stop shipping wafers to Huawei.
Huawei chief executive of consumer business Richard Yu (余承東) subsequently said that the company would stop making its Kirin chips on Tuesday because of US measures to cut off its chipmaking unit HiSilicon Technologies Co (海思半導體) from vital technology.
HiSilicon relies on software from US firms such as Cadence Design Systems Inc and Synopsys Inc to design its chips, and outsources production to TSMC, which uses US-made equipment.
Wholesale traders at the market said that they had been busy for the past month meeting extra demand for online sales, with prices of higher-end phones rising every few hours.
They were uncertain how much supply remained at distributors.
Huawei does not disclose inventory information.
A company spokesman told reporters that the firm continues to operate according to demand.
It likely has chip inventory to last through the first half of next year, International Data Corp analyst Will Wong said.
“One option for them to have Kirin chips last longer is to ship less for the rest of the year,” Wong said.
In related news, companies that supply the chip sector with sophisticated and expensive equipment plan to warn US President Donald Trump’s administration against a proposal to blacklist China’s top chipmaker, Semiconductor Manufacturing International Corp (SMIC, 中芯國際), arguing that it would be “detrimental” to US industry.
The companies are represented by the semiconductor and electronics manufacturing suppliers, industry group SEMI, which drafted a letter that could be sent as soon as this week to US Secretary of Commerce Wilbur Ross.
In the draft letter, the group wrote that blacklisting SMIC would jeopardize the US’ technological edge by making it harder for US companies to supply the company, which accounts for as much as US$5 billion in annual US-origin equipment and material sales.
They also said that such a move would “contribute to a growing perception” that the delivery of US goods is “unreliable” and hit US market share worldwide.
“We urge the [US] Department [of Commerce] to carefully consider the immediate and long-term detrimental impacts to US industry, economic and national security that may result from the addition of SMIC to the Entity List,” said the group, which has 2,400 members worldwide, including SMIC and US chip equipment makers Lam Research Corp and Applied Materials Inc.
The department did not immediately respond to a request for comment.
SEMI vice president of global public policy Joe Pasetti said: “We don’t comment on draft letters leaked to the press.”
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San