Huawei Mate 60 Pro Leads China's Charge In 5G Tech Self-Reliance
Portfolio Pulse from Ananya Gairola
Huawei Technologies Co. has made significant strides in self-reliance on 5G technology with its Mate 60 Pro smartphone, which now uses radio-frequency chips from domestic suppliers instead of U.S. companies like Skyworks Solutions Inc. (SWKS) and Qorvo Inc. (QRVO). This development is part of China's broader strategy to create an independent chip ecosystem, with Huawei leading the charge as a chip designer and supporter of smaller firms in the supply chain. The move reduces Huawei's reliance on U.S. suppliers such as Qualcomm Inc. (QCOM), and positions Huawei as a strong competitor in the AI chip market, as acknowledged by NVIDIA Corp. (NVDA) CEO Jensen Huang.
December 11, 2023 | 12:34 pm
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NEUTRAL IMPACT
NVIDIA Corp. acknowledges Huawei as a significant competitor in the AI chip market, which could influence NVIDIA's competitive landscape.
While NVIDIA's CEO has acknowledged Huawei as a competitor, the direct short-term impact on NVIDIA's stock is uncertain. However, increased competition in the AI chip market could have long-term implications for NVIDIA's market position.
CONFIDENCE 70
IMPORTANCE 40
RELEVANCE 50
NEGATIVE IMPACT
Qualcomm Inc. faces challenges as Huawei's advancements in chip technology reduce its reliance on Qualcomm's products.
Huawei's progress in developing its own chips and reducing reliance on U.S. suppliers like Qualcomm could lead to decreased sales for Qualcomm, particularly if this trend continues and expands to other Chinese manufacturers.
CONFIDENCE 75
IMPORTANCE 50
RELEVANCE 60
NEGATIVE IMPACT
Qorvo Inc. may experience a decline in sales to Huawei as the Mate 60 Pro features chips from Chinese suppliers, reducing dependence on Qorvo's products.
Similar to Skyworks, Qorvo Inc. is likely to be impacted by Huawei's decision to source RF chips from domestic suppliers, which could lead to a decrease in orders from one of its previously significant customers.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
Skyworks Solutions may face reduced demand for its radio-frequency chips as Huawei shifts to domestic suppliers for its Mate 60 Pro smartphone.
Huawei's move to use domestic suppliers for RF chips in its new smartphone indicates a potential decrease in business for Skyworks Solutions from Huawei, which could negatively affect Skyworks' short-term revenue from the Chinese market.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70