US-sanctioned Huawei denies breakthrough in chip packaging tech as speculation mounts on firm’s efforts to overcome trade restrictions

Speculation has been rife about Huawei’s development of a new semiconductor packaging technology that can achieve 7-nanometre performance for chips
Strict US trade restrictions have effectively cut Huawei’s access to advanced new integrated circuits for its smartphones and other devices

Huawei

Iris Dengin Shenzhen

Published: 9:00pm, 15 Mar 2023

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Chinese telecommunications giant Huawei Technologies Co has dismissed speculation about its development of an innovative semiconductor packaging technology, which would enable the US-sanctioned company to produce advanced chips for its smartphones and other devices, despite strict restrictions imposed by Washington.

Shenzhen-based Huawei on Tuesday denied the rumours, which claimed that the new packaging tech was able to achieve 7-nanometre performance for chips, according to a report on Chinese media outlet Sina.com.

Semiconductors manufactured on 7-nm technology node have smaller transistors and perform faster with increased energy efficiency. These chips enable smartphones and other electronics devices to provide more features and consume less power.

Huawei declined to comment on Wednesday.

Huawei Technologies Co has been the subject of rumours linking it to new chip packaging technology, which could help the company produce advanced semiconductors for its smartphones and other devices. Photo: Reuters

It is another US-blacklisted company, Semiconductor Manufacturing International Corp (SMIC), that is known to have already started using the 7-nm process to produce integrated circuits.

That conclusion was reached by Canada-based research firm TechInsights last year after inspecting a sample chip extracted from a cryptocurrency mining machine. SMIC, mainland China’s largest and most advanced contract chip maker, has not made any public comment about this finding.

Speculation about Huawei’s chip plans reflect strong interest in its home market on how the company, the world’s largest telecoms equipment supplier and formerly China’s biggest smartphone vendor, can overcome stringent US trade restrictions.

Last year, Huawei ran out of in-house-designed semiconductors for its smartphones after US trade sanctions effectively cut the company’s access to advanced new chips, according to a report by Counterpoint Research. The company’s soon-to-be-launched P60 smartphone model is expected to use Qualcomm’s Snapdragon chip.

Huawei runs out of advanced in-house-designed chips for smartphones: report

The latest rumours about Huawei’s chip packaging breakthrough coincided with a surge in the share price of Chinese semiconductor firms on Tuesday.

Shares of dual-listed SMIC rose 10 per cent in Shanghai and 7 per cent in Hong Kong that day. Shenzhen-listed Naura Technology Group and Hua Hong Semiconductor in Hong Kong also saw their shares rise.

The bullish sentiment in the semiconductor industry followed the first press conference conducted by Li Qiang, China’s new premier, on Monday. Li said the country will sharpen its focus on high-quality developments as well as improvements in science and technology, while dismissing US-China decoupling as mere “hype”.

Interest in Huawei’s semiconductor moves heightened in April last year, when the company filed a patent application on the mainland for a semiconductor packaging innovation.

Huawei bets on new chip packaging tech to ease disruptions caused by US sanctions

That application for “a type of chip stacking package and terminal device” is expected to help “solve the problem of high costs due to the use of through-chip via [also known as through-silicon via or TSV], while ensuring power supply requirements”, according to a statement released at the time by the China National Intellectual Property Administration (CNIPA).

The filing came days after Huawei’s then-rotating chairman Guo Ping suggested at a press conference that the company would use advanced chip packaging technology to help alleviate the firm’s struggles with US trade sanctions.

Huawei had earlier applied for a patent on so-called extreme ultraviolet (EUV) lithography in May 2021, which was only made public by CNIPA late last year. Major chip makers use EUV lithography equipment, which employs laser technology to basically carve a pre-designed circuit onto a wafer, to produce advanced chips.

Huawei, which was added to Washington’s trade blacklist in May 2019, has been scrambling to adapt its operations to tighter restrictions imposed in 2020, covering access to chips developed or produced using US technology, from anywhere. The company faces increased pressure this year amid reports that the Biden administration is considering cutting it off completely from US exports.