Huawei has undoubtedly been the company hardest hit by the trade war between the United States and China. While relations between the two countries have always been tense, the previous administration of Donald Trump escalated the situation with severe sanctions against the company. Years later, Huawei could be forced to continue using chips with the older 7nm manufacturing process in its devices from 2025.
The manufacturing process in chips is much more important than many believe. The biggest generational leaps in power and efficiency arrive with new, more modern processes. Even the choice of factories plays a significant role, as demonstrated by the recent issues with multiple chips manufactured by Samsung Foundry. Big tech brands currently use 3nm SoCs in their flagship smartphones, while Huawei has remained stuck at 7nm.
Some background on Huawei restrictions
For context, the initial restrictions against Huawei, while already severe, still allowed it to access certain key components from American companies through licensing. For example, the Huawei P60 series relied on a 4G version of the Snapdragon 8+ Gen 1 chip. At the time, the company could still source chips from Qualcomm, but not 5G-related technologies (modems). The US government later revoked the license, and Huawei had to revert to its own Kirin chips.
Trade restrictions also prevent companies operating in the US from doing business with Huawei. This includes TSMC and Samsung, which are unable to manufacture Kirin chips. This forced Huawei to turn to SMIC, a Chinese chipmaker whose factories lag technologically behind the industry’s biggest names. So, Huawei’s latest Kirin chips have had to use older manufacturing processes.
Huawei’s next-gen chips to be manufactured on 7nm process, Bloomberg reports
Now, a Bloomberg report claims that Huawei’s 2025 Kirin chips will also use the old 7nm process. Previous reports suggested that Huawei’s next flagship chips could finally make the jump to a more modern 5nm process. However, SMIC has apparently been unable to upgrade its wafers and is even having trouble developing sufficient quantities of 7nm chips. For reference, processors like the 2021 Snapdragon 870 were manufactured in 7nm.
The situation could also affect Huawei in the AI space. The company cannot do business with NVIDIA, so it does not have access to its AI chips. Huawei has been working on its own alternative, known as Ascend AI Chips. According to reports, it will be a series of chips that will include an Ascend 910C and another unknown model.
Some analysts claim that the Ascend AI chips could even be more efficient than the Nvidia H100. However, the lack of access to the best manufacturing processes is a rather difficult hurdle to overcome. Considering that it was Donald Trump who initiated the sanctions against Huawei, the future of the company does not look encouraging in this regard.
