Last November, the US government imposed a ban on the sale of telecommunications equipment to Huawei Technologies in the interest of national security. As a result, the company’s consumer electronics business was shut down. However, Huawei is reportedly planning to return to the 5G smartphone industry later this year.
And now a report has revealed that Huawei plans to build the 5G chip using its own advances in semiconductor design tools, including chipmaking from Semiconductor Manufacturing International Company (SMIC).
Three third-party technology research firms that work in China’s smartphone sector told Reuters about Huawei’s return to the 5G phone market. The companies cited industry insiders, including Huawei suppliers, with the information on condition of anonymity due to confidentiality agreements with customers.
However, Huawei refused to comment on the matter. Semiconductor Manufacturing International Co. also had no comment.
The return of 5G to the smartphone market will be a huge success for Huawei. Revenue from the company’s consumer business peaked at 483 billion yuan in 2020, but that revenue fell by nearly 50 percent a year later.
Notably, it was also part of a rivalry with Apple and Samsung to become the world’s largest handset maker until US restrictions that began in 2019 cut off access to the chipmaking equipment needed to make their most advanced models. However, the US and European governments have identified Huawei as a threat to their national security, a charge the company denies.
But since then, Huawei has only been able to sell a limited number of batches of 5G models using stock chips. Sales of last-generation 4G handsets have also stalled, according to Canalys consultancy. Huawei’s ranking fell in most of the global markets last year as sales bottomed out. However, the company managed to capture 10 percent market share in China in the first quarter.
Huawei shipped 240.6 million smartphones worldwide in 2019, which was the best year for the company.
Huawei announced in March that it had made breakthroughs in electronic design automation tools for chips built on 14-nanometer and higher processes, research firms said. Chip design companies use EDA software to create blueprints for chips before mass production.