Huawei Commits to AI for the Next Decade Despite Advanced Chip Restrictions

Huawei recently announced that it intends to make artificial intelligence a focal point of its strategy for the coming decade. Interestingly, this commitment suggests the firm has a plan for navigating U.S. export restrictions cutting it off from advanced chips and fab equipment.

Artificial intelligence (AI) has taken over every industry as leaders seek new ways to integrate the technology into their operations. Huawei, one of China’s most important tech firms, recently announced its intention to prioritize AI over the next decade. The decision ends a nearly 10-year silence on strategic direction and comes on the heels of recent chip success.  

Huawei is now one of many companies in the tech sector with AI at the forefront of its strategy. However, unlike other players, it’s unclear exactly how the Chinese firm plans to realize its approach.  

Betting on AI

Over the past two decades, Huawei has set its sights on cloud computing and intellectual property, respectively. The last few years have been particularly challenging after the firm was placed on the U.S. entity list, barring it from trade with key technology partners and suppliers. The move sent Huawei into “crisis mode” for several years as it scrambled to rebuild its supply chain and continue innovating without access to advanced chips and equipment.  

Now, despite continued profit declines, the firm believes it is out of crisis mode and feels comfortable pursuing new paths.  

In a statement, Huawei’s rotating chairwoman and CFO, Meng Wanzhou, said, “As artificial intelligence gains steam, and its impact on industry continues to grow, Huawei’s AI intelligence strategy is designed to help all industries make the most of new strategic opportunities.”  

How exactly the firm plans to accomplish this remains unclear. At the time of this writing, Huawei hasn’t provided an outline of its AI strategy or offered details of how it will reprioritize its direction moving forward. Nonetheless, Wanzhou claims Huawei is “committed to building a solid computing backbone for China—and another option for the world.”  

“Our end goal is to help meet the diverse AI computing needs of different industries,” she added.

Unsurprisingly, Huawei isn’t the first Chinese tech firm to set its sights on AI. Alibaba, China’s largest online commerce company, announced its own plans to prioritize AI last month. The move is also preceded by a host of U.S. and international tech firms that have placed AI at the center of their futures.  

Chip Breakthrough

By emphasizing AI, Huawei is also wordlessly committing to advanced chip technology over the next ten years. This is an interesting note given that it remains cut off from key fab equipment and technology from U.S. firms and those of its allies.  

Even so, it appears Huawei is successfully working around these challenges. The firm recently announced its new flagship smartphone, the Mate 60 Pro, which features a 5G chip made with 7nm technology. In theory, China shouldn’t have access to the equipment needed to produce these chips at volume. This announcement prompted investigators from the U.S. to look into whether Huawei has found a way to sidestep export controls and acquire the necessary equipment.  

Others posit the firm partnered with China’s SMIC to produce the advanced chips using outdated ASML deep ultraviolet (DUV) lithography technology—albeit with a very poor yield. If so, the Chinese government likely helped subsidize the move.  

Regardless of the means, the fact remains that Huawei has successfully mass-produced an advanced 5G chip within a matter of years after being restricted by the U.S. This is a massive accomplishment with even larger implications for the global chip industry.

Whether or not Huawei can repeat this feat with advanced chips for its AI applications remains to be seen. However, by announcing a commitment to the technology over the next decade, it’s all but certain the firm will be (or already is) trying. This is a key development to watch as both the continued emergence of AI and global economic tensions continue to evolve.

Author of article
Sourceability Team
The Sourceability Team is a group of writers, engineers, and industry experts with decades of experience within the electronic component industry from design to distribution.
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