Huawei Planning Large-Scale Layoffs In Its US R&D Subsidiary: Reports

Huawei Technologies Co Ltd is planning to slash hundreds of jobs at its Research and Development (R&D) subsidiary in the United States as the Chinese telecom equipment manufacturer grapples with its US blacklisting, the Wall Street Journal reported.

Huawei’s US-based research and development subsidiary, Futurewei Technologies, employs about 850 people in research labs across the US, including in Texas, California and Washington state.

Following the 16 May decision by the US Commerce Department to place Huawei on its entity list which blocks companies from supplying US-sourced technology to Huawei without a license, Futurewei employees have faced difficulties communicating with their China-based colleagues. The Chinese telecom giant employs over 180,000 people worldwide.

The sustained campaign by Donald Trump-led US Administration against Huawei Technologies is causing enormous damage to the company.

Last month, the company’s founder and CEO Ren Zhengfei forecasted a hit to revenue to the tune of $30 billion this year and next.

“Over the next two years, the company will reduce production. We estimate we’ll reduce production by $30bn,” Ren Zhengfei said during a discussion “This [calendar] year and next year, our revenues will be around $100bn,”

Earlier this May, the US put Huawei on a blacklist, restricting sales from American companies to the Chinese telecoms giant. US officials have long been accusing Chinese tech companies like Huawei of stealing trade secrets and threatening cybersecurity.

Trump Administration has also initiated measures to bar US carriers from using Huawei equipment for next-generation 5G networks on the grounds of national security. Huawei had made massive investment in 5G wireless technology, hoping to lead the world in the race to adopt the new technology.

The United States has charged that Huawei and its widely used technologies is potentially accessed by the Chinese state for its espionage. The company has pushed back on the claim, insisting that it is an independent company with no government ties.

Huawei is the world’s largest maker of telecommunications equipment and the number two vendor of smartphones, ahead of Apple Inc. and behind Samsung Electronics Co.