London Daily

Focus on the big picture.
Thursday, Oct 23, 2025

Could Huawei founder Ren Zhengfei give up on 5G to keep the company alive?

Huawei’s short term strategy has been to stockpile chips from its key silicon supplier TSMC. The company’s carrier business, which includes 5G, is about one third of total company revenue

Huawei Technologies founder Ren Zhengfei told the Post earlier this year that he hopes to be forgotten after retiring from the company.

“My biggest wish is to drink coffee in a cafe unnoticed,” said the 75 year old.

But standing between Ren and those anonymous visits to coffee shops is probably the biggest decision of his career.

In May, the Trump Administration announced a new direct product rule (DPR) that effectively blocks Huawei's access to advanced semiconductors – the brains inside all of its products. While Huawei was able to survive Washington’s first attempt to deny it access to US core tech in May last year, this time it has no wriggle room left.

Huawei’s short term strategy has been to take advantage of a two month grace period to stockpile chips from its key silicon supplier TSMC. After September, TSMC and other companies that use US chipmaking equipment (including China’s SMIC) will need a waiver from Washington to supply Huawei.

A Jefferies report earlier this week said Huawei has enough inventory of 5G base station chips to last until the end of next year, but after that the situation was “highly uncertain”.

If Huawei is hiring lawyers and consultants to find loopholes in the new ruling it is very likely wasting money. “We reaffirm that we will implement the rule aggressively and pursue any attempt to evade its intent,” US Commerce Secretary Wilbur Ross was quoted as saying by Reuters last month.

So what is the long term solution for Huawei? There has been speculation that it could find an alternative wafer fabrication partner to TSMC – one that can supply chips made using equipment from Europe and Japan instead.

Even if that were feasible, it is unlikely Japan, The Netherlands and Germany – the main suppliers of non-US chip making gear – would openly defy Washington by making it possible for Huawei to continue buying 5G chips.

Earlier this year Dutch company ASML was blocked from shipping the latest generation EUV lithography machine to Chinese foundry SMIC under pressure from Washington.

With its 5G chip stockpile set to run out sooner or later, Huawei doesn’t have many options. It could take a decade or more to come up with a viable alternative to US chipmaking technology, and the billions of dollars Beijing has vowed to spend to upgrade China’s domestic chip industry may not help either because in many instances that needs US equipment, so is still subject to the new ban.

But there is one way Ren might be able to save his company.

Although Huawei’s relationship with the US has soured over a host of issues dating back many years, 5G is at the core of the current confrontation. And Trump is winning.

The tide has turned against Huawei in the international 5G markets, especially after Boris Johnson’s decision earlier this month to ban the company from Britain’s 5G roll out. However, this is all moot because when its stockpile of 5G base station chips runs out, Huawei won’t be able to provide the same products anyway – including to its domestic Chinese telco customers.

By that stage, Huawei's other products would also be starved of semiconductors. That is, unless Ren cuts 5G loose and refocuses on his other businesses, such as smartphones, where it is No 2 behind Samsung Electronics.

Huawei’s carrier business, which includes 5G, is about one third of total company revenue. Walking away from 5G would be a bitter pill to swallow – not just for the loss of revenue. Huawei is viewed by the Chinese government as a global tech champion and bulwark against US dominance in tech.

Amid deteriorating relations with Washington last year, Ren himself offered to share Huawei’s 5G technology with a major western company for a one-time fee. His motive seemed to reflect a preference to battle a US competitor in the market than fight the US government.

If US-China relations were not so toxic, such an offer might have helped, but not now. In the current geopolitical environment, any Chinese tech company with perceived links to Beijing is a target, with ByteDance’s TikTok short video app also in the Trump Administration’s cross hairs. There has been media speculation that ByteDance could sell TikTok to a buyer to head off its problems.

If Huawei withdrew from the 5G business altogether it would still earn royalties from its patents. Or the company could consider selling its 5G patent portfolio outright, which might provide a face saving exit for Ren.

This is, assuming Washington hardliners don't want to kill Huawei outright – regardless of what business it operates in.

Since he founded Huawei more than 30 years ago, Ren has fought many battles in the marketplace. The former PLA engineer likes to invoke military slogans to motivate the company troops, especially during difficult times.

That mindset has alarmed some in Washington, including FBI director Christopher Wray. In a widely reported speech on China to the Hudson Institute on July 7, Wray was perturbed after reading the military language used by Ren in a speech to employees, as reported in The Wall Street Journal last month.

“He reportedly told employees that to ensure the company’s survival, they need to – and I quote – ‘surge forward, killing as you go, to blaze us a trail of blood’,” Wray said. “He’s also reportedly told employees that Huawei has entered, to quote, ‘a state of war’.”

It doesn't sound like Ren intends to mount a tactical retreat on 5G so he can live to fight another day. But Huawei will soon run out of “ammunition” in the form of 5G chips. And that could mean the loss of thousands of highly skilled jobs.
After this battle is over, Ren may find it even harder to go unnoticed in coffee shops in retirement.

Newsletter

Related Articles

0:00
0:00
Close
US Administration Under President Donald Trump Reportedly Lifts Ban on Ukraine’s Use of Storm Shadow Missiles Against Russia
‘Frightening’ First Night in Prison for Sarkozy: Inmates Riot and Shout ‘Little Nicolas’
White House Announces No Imminent Summit Between Trump and Putin
US and Qatar Warn EU of Trade and Energy Risks from Tough Climate Regulation
Apple Challenges EU Digital Markets Act Crackdown in Landmark Court Battle
Nicolas Sarkozy begins five-year prison term at La Santé in Paris
Japan stocks surge to record as Sanae Takaichi becomes Prime Minister
This Is How the 'Heist of the Century' Was Carried Out at the Louvre in Seven Minutes: France Humiliated as Crown with 2,000 Diamonds Vanishes
China Warns UK of ‘Consequences’ After Delay to London Embassy Approval
France’s Wealthy Shift Billions to Luxembourg and Switzerland Amid Tax and Political Turmoil
"Sniper Position": Observation Post Targeting 'Air Force One' Found Before Trump’s Arrival in Florida
Shouting Match at the White House: 'Trump Cursed, Threw Maps, and Told Zelensky – "Putin Will Destroy You"'
Windows’ Own ‘Siri’ Has Arrived: You Can Now Talk to Your Computer
Thailand and Singapore Investigate Cambodian-Based Prince Group as U.S. and U.K. Sanctions Unfold
‘No Kings’ Protests Inflate Numbers — But History Shows Nations Collapse Without Strong Executive Power
Chinese Tech Giants Halt Stablecoin Launches After Beijing’s Regulatory Intervention
Manhattan Jury Holds BNP Paribas Liable for Enabling Sudanese Government Abuses
Trump Orders Immediate Release of Former Congressman George Santos After Commuting Prison Sentence
S&P Downgrades France’s Credit Rating, Citing Soaring Debt and Political Instability
Ofcom Rules BBC’s Gaza Documentary ‘Materially Misleading’ Over Narrator’s Hamas Ties
Diane Keaton’s Cause of Death Revealed as Pneumonia, Family Confirms
Former Lostprophets Frontman Ian Watkins Stabbed to Death in British Prison
"The Tsunami Is Coming, and It’s Massive": The World’s Richest Man Unveils a New AI Vision
Outsider, Heroine, Trailblazer: Diane Keaton Was Always a Little Strange — and Forever One of a Kind
Dramatic Development in the Death of 'Mango' Founder: Billionaire's Son Suspected of Murder
Two Years of Darkness: The Harrowing Testimonies of Israeli Hostages Emerging From Gaza Captivity
EU Moves to Use Frozen Russian Assets to Buy U.S. Weapons for Ukraine
Europe Emerges as the Biggest Casualty in U.S.-China Rare Earth Rivalry
HSBC Confronts Strategic Crossroads as NAB Seeks Only Retail Arm in Australia Exit
U.S. Chamber Sues Trump Over $100,000 H-1B Visa Fee
Shenzhen Expo Spotlights China’s Quantum Step in Semiconductor Self-Reliance
China Accelerates to the Forefront in Global Nuclear Fusion Race
Yachts, Private Jets, and a Picasso Painting: Exposed as 'One of the Largest Frauds in History'
Australia’s Wedgetail Spies Aid NATO Response as Russian MiGs Breach Estonian Airspace
McGowan Urges Chalmers to Cut Spending Over Tax Hike to Close $20 Billion Budget Gap
Victoria Orders Review of Transgender Prison Placement Amid Safety Concerns for Female Inmates
U.S. Treasury Mobilises New $20 Billion Debt Facility to Stabilise Argentina
French Business Leaders Decry Budget as Macron’s Pro-Enterprise Promise Undermined
Trump Claims Modi Pledged India Would End Russian Oil Imports Amid U.S. Tariff Pressure
Surging AI Startup Valuations Fuel Bubble Concerns Among Top Investors
Australian Punter Archie Wilson Tears Up During Nebraska Press Conference, Sparking Conversation on Male Vulnerability
Australia Confirms U.S. Access to Upgraded Submarine Shipyard Under AUKUS Deal
“Firepower” Promised for Ukraine as NATO Ministers Meet — But U.S. Tomahawks Remain Undecided
Brands Confront New Dilemma as Extremists Adopt Fashion Labels
The Sydney Sweeney and Jeans Storm: “The Outcome Surpassed Our Wildest Dreams”
Erika Kirk Delivers Moving Tribute at White House as Trump Awards Charlie Presidential Medal of Freedom
British Food Influencer ‘Big John’ Detained in Australia After Visa Dispute
ScamBodia: The Chinese Fraud Empire Shielded by Cambodia’s Ruling Elite
French PM Suspends Macron’s Pension Reform Until After 2027 in Bid to Stabilize Government
Orange, Bouygues and Free Make €17 Billion Bid for Drahi’s Altice France Telecom Assets
×