Nowadays, Chinese manufacturers are aware of the importance of independent research and development, and work together to promote the development of China's chip industry.
In 2020, ARM will stop supplying and supporting Huawei, in fact, ARM itself does not directly produce chips. But most of the chips used in smartphones in the world are based on ARM architecture, such as Qualcomm, Apple, etc.
In fact, this kind of thing is not an isolated case, in addition to ARM, many American chip companies have announced that they will stop shipping advanced chips, technologies and semiconductor equipment.
In response to such incidents, Microsoft's founder Bill Gates has said since he said that the implementation of chip supply cuts to China will only force China to speed up the speed of self-developed chips, and at the same time, a large number of personnel in the chip industry will lose their high-paying jobs. I don't know if other people took Bill Gates's words to heart at the time, but at least looking back now, Bill Gates's words became a prophecy.
Now that the restriction has the opposite effect, the US chip companies that restrict chip shipments have begun to experience a sharp decline in revenue, and at the same time, in order to cut expenses, they have to start large-scale layoffs.
Now ARM has officially announced that it will lay off 12 to 15 percent of its workforce, about 1,000 people. The news of layoffs is definitely not a healthy sign, and if it is too late for a company to recruit more talent, how can it lay off employees?
ARM's majority shareholder, Japan's SoftBank, is also at risk of a series of declines in its share price, after many of its various investments in the United States failed, and therefore faced a serious debt crisis. At this moment, I can't take care of myself, and of course, I can't take care of ARM's predicament. In the face of such a situation, some foreign media claimed: Maybe this is the consequence of cutting off Huawei's supply.
ARM has also faced some turnarounds before, such as Nvidia, which seems to be interested in acquiring ARM for $40 billion. But on January 25, 2022, it was revealed that Nvidia abandoned its original acquisition plan.
After Nvidia abandoned the acquisition of ARM, Japan's SoftBank immediately began to look for alternatives and began to prepare for ARM's initial public offering, as if ARM was a hot potato.
In fact, it is very understandable that there are such consequences, after all, Huawei mobile phones have developed very rapidly in the global market before they were targeted. In this case, ARM's market share is naturally getting bigger and bigger, and it can benefit a lot.
However, once the supply to Huawei is cut off, then a very large market will be lost. Although it did have a certain impact on Huawei, it was obviously an act of injuring the enemy by 800 and injuring 1,000 by itself. In the context of global trade, companies around the world are becoming more and more connected, and it is not wise to cut ties rashly.
It turns out that many Chinese enterprises think that it is better to buy than to build, and there are already mature products abroad, and there is no need to spend effort to develop them from scratch in China, which is not only expensive, but also cannot guarantee profitability in the competition with mature products.
Now it is precisely because of their supply interruption that domestic enterprises have made efforts. Originally, people thought, "Who is responsible for the problem of using immature products?" Now everyone is worried: "If you rely on imported products so much, who will be responsible if the supply is cut off?"
ARM's layoffs of thousands of employees are just the beginning, and this is one of the consequences of cutting off supply to Huawei. Do you think ARM will be able to get out of the quagmire?
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