Trade Tensions: Intel, Qualcomm Encounter Export Restrictions to China Amid Beijing’s Opposition
Intel announced on Wednesday that its sales would suffer due to the U.S. revoking some of its export licenses for a Chinese customer. The move has prompted criticism from Beijing, which believes it is an excessive measure under the guise of national security. While Intel did not disclose the name of the Chinese customer affected by the revoked licenses, it’s been reported that the U.S. has canceled licenses allowing companies like Intel and Qualcomm to ship chips used in laptops and handsets to Huawei Technologies, a sanctioned Chinese telecoms equipment maker.
The release of Huawei’s first AI-enabled laptop, the MateBook X Pro, in April, which is powered by Intel’s new Core Ultra 9 processor, drew criticism from Republican lawmakers who questioned whether the Commerce Department had authorized Intel to sell the chip to Huawei.
Following the news, Intel’s shares fell by 2.9% to $29.80. The company expects its revenue for the second quarter to remain in the range of $12.5 billion to $13.5 billion but below the midpoint. Intel’s shares have already dropped by nearly 38% this year. Qualcomm also confirmed that one of Huawei’s export licenses had been revoked, but its shares remained flat.
Commerce Secretary Gina Raimondo stated that Huawei poses a threat, emphasizing that the move to revoke licenses is not a policy change but a response to increased awareness of AI capabilities. The Chinese foreign ministry criticized the U.S. action, accusing it of overreaching the concept of national security and abusing export controls to suppress Chinese companies without justification.
The United States has been wary of Huawei since 2019, placing the company on a trade restriction list amid concerns about potential spying activities. President Joe Biden’s administration has continued efforts to restrict China’s access to sensitive technology, employing tactics such as export bans and diplomatic maneuvers with allied nations. This strategy aims to curb China’s rapid technological advancements across various sectors.
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