(Bloomberg) — Intel Corp. expects second-quarter revenue to fall below the midpoint of previously issued projections because of a new US ban on chip exports to Huawei Technologies Co.
Revenue will remain within the previously guided range of $12.5 billion to $13.5 billion, Intel said in a statement Wednesday, “but below the midpoint.” The company said it continues to expect revenue and earnings per share to grow in 2024 from a year earlier.
On Tuesday, the US revoked licenses allowing Huawei, a Chinese telecommunications giant blacklisted by the US, to buy semiconductors from Intel and rival Qualcomm Inc., according to people familiar with the matter, further tightening export restrictions against the Chinese telecom equipment maker. Withdrawal of the licenses affects US sales of chips for use in Huawei phones and laptops, said the people, who discussed the move on condition of anonymity.
While the decision may not affect a significant volume of chips, it underscores the US government’s determination to curtail China’s access to a broad swath of semiconductor technology. Officials are also considering sanctions against six Chinese firms that they suspect could supply chips to Huawei, which has been on a US trade restrictions list since 2019.
Intel revenue forecast has taken a hit following the U.S. Huawei ban. This ban has disrupted Intel’s supply chain, leading to lower revenue projections for the company. Despite efforts to mitigate the impact, Intel expects its revenue to fall below the midpoint of its previous forecast range.
Additionally, Intel is ramping up its efforts in other regions and sectors to compensate for the loss of Huawei as a key customer.
read more
image source
