After HiSilicon chips were unable to continue production due to US sanctions, Huawei began to move towards using MediaTek chips. But with further escalation of the US ban, that path has been hampered. To this, MediaTek responded today.
MediaTek said the company has always followed the provisions of global trade-related laws and regulations and is closely monitoring changes in US export control rules.
The company also said it has been consulting with outside legal counsel to obtain the latest regulations in real-time for legal analysis to ensure compliance with the relevant rules.
"Based on the assessment of available information, there is no material impact on the Company's short-term operating condition," MediaTek added.
On August 17, the US Department of Commerce's Bureau of Industry and Security (BIS) issued a revised ban on Huawei, further restricting its use of products made with US technology and software.
The new version of the ban adds 38 Huawei affiliates to the entity list, which means that Huawei's path to outsourcing chips will be "blocked."
MediaTek's shares plunged by about 10 percent on Tuesday.
It was previously reported that Huawei recently ordered 120 million chips from MediaTek, and seven of the handsets released this year are powered by MediaTek chips.
Taiwan's Business Times reported on July 7 that Huawei's new 5G phones, which are expected to be launched in the second half of the year, will also use the MediaTek solution.
According to the report, Huawei has shown little interest in Qualcomm's phone chips, and in 2021 it will accelerate the introduction of MediaTek 5G mobile phone chips and is expected to become MediaTek's largest customer.
Huawei will be MediaTek's biggest customer for chips next year, report says
Huawei originally commissioned TSMC 5nm foundry Kirin 1020 mobile phone chip, because the ban has been partially completed before the release of the photomask process, so can still rush to ship within the 120-day grace period.
Analysts said out that Hisilicon will be able to ship about 20,000 Kirin 1020 wafers in August and September and that can still support 8.5 million to 9 million Mate40 phone shipments.
