Sanctions imposed against Chinese multinational tech firm Huawei Technologies Co. Ltd. have dampened the global chip supply and exacerbated the ongoing shortage, according to an analyst.
- Counterpoint Research Partner Neil Shah said that while the US-led international sanctions on Huawei benefitted a number of tech firms such as Apple, Xiaomi, Qualcomm, Nokia, and Ericsson, this also has a negative effect on markets.
- Shah said Huawei “sucked in most of the components supply” to boost its smartphone business in the next year, pushing mobile competitors to race to secure supplies and leaving other industries such as automotives to fend for chips.
- Initiatives to dampen Huawei’s business accelerated under the leadership of President Donald Trump, with significant efforts to keep other countries from acquiring supplies from Huawei for their 5G networks.
Huawei had since seen a decline in its global market share to 2% in September from 17% in March 2020.