Huawei Restrictions Endure as US-China Tech Decoupling Hardens
Existing federal bans remain firmly in place as the Chinese telecom giant posts record revenue despite years of American sanctions.
Washington’s multilayered restrictions on Huawei Technologies remain among the most comprehensive sanctions imposed on any foreign technology company, even as the Chinese telecom giant reported revenue of $118.16 billion in 2024—its highest ever.
The persistence of these measures, spanning procurement bans, Export Controls, and equipment authorization restrictions, reflects a bipartisan consensus that has survived three presidential administrations. According to Congressional Research Service analysis, federal agencies have been prohibited from purchasing Huawei equipment since 2018, while Section 889 of the 2019 National Defense Authorization Act bars agencies from contracting with any entity that uses Huawei components as a substantial part of their systems.
The Regulatory Architecture
The US crackdown began in earnest in 2017, when Congress restricted Department of Defense networks from using Huawei or ZTE equipment. The campaign escalated in 2019 when the Commerce Department added Huawei to its Entity List, requiring American companies to obtain licenses—which are presumed denied—before exporting technology to the company.
In November 2022, the Federal Communications Commission banned the authorization of new Huawei telecommunications equipment for sale in the US market. The move, implementing the Secure Equipment Act signed by President Biden in 2021, marked what FCC Commissioner Brendan Carr called “the first time in FCC history” the agency prohibited equipment authorization based on National Security concerns.
The regulatory net extends beyond direct procurement. Federal contractors must certify they do not use Huawei equipment anywhere in their operations—not just in systems sold to the government. The Professional Services Council, representing over 400 government contractors, described the requirements as a “time-consuming, burdensome and costly exercise” according to Congressional Research Service documentation.
Huawei’s American Footprint: Limited and Shrinking
Huawei maintains minimal direct operations in the United States. The company operates in over 170 countries with approximately 208,000 employees globally, according to Huawei corporate disclosures, but public information about its specific US workforce and revenue is scarce. The company historically provided connectivity to rural areas in states including Alabama, Colorado, and Oklahoma, according to Council on Foreign Relations analysis.
In January 2024, Bloomberg reported that Huawei ended its in-house lobbying operations in Washington. The company’s chief security officer previously argued that restrictions would harm American jobs, noting Huawei spent over $11 billion annually with US suppliers.
The Chinese market now accounts for 71.4% of Huawei’s total revenue, up from lower concentrations before Sanctions took effect. The EMEA region contributed $20.3 billion in 2024, representing just 2% growth year-over-year.
Pentagon’s Persistent Dilemma
Even the Department of Defense struggles with total separation from Huawei infrastructure. The Pentagon has consistently sought waivers from Section 889 restrictions, arguing that Huawei’s entrenchment in global telecommunications networks—the company controls nearly one-third of all telecom equipment revenue globally—makes complete avoidance impossible when operating overseas.
Senator Mark Warner, chairman of the Senate Intelligence Committee, acknowledged the challenge in a statement to Fortune: “I understand the need for 889 waivers in limited contexts where it’s in the larger national security interest of the United States.”
The restrictions stem from concerns that Chinese intelligence laws compel companies to cooperate with state security agencies. According to legal analyses, China’s 2014 Counter-Espionage Law and 2017 National Intelligence Law can require Huawei and other firms to assist state intelligence operations, though the company denies ever providing data to Beijing.
The Decoupling Paradox
US sanctions appear to have accelerated, rather than crippled, Huawei’s technological independence. An October 2025 Information Technology and Innovation Foundation report titled “Backfire” found that export controls helped Huawei develop indigenous capabilities while harming American firms that lost a major customer.
Huawei’s global telecom equipment market share increased from 29% in early 2018 to 31% by 2024, according to the analysis. The company now produces its own HarmonyOS operating system with 1 billion active users and has developed the Ascend line of AI chips to replace restricted Nvidia products. Research from academic studies suggests “the consequences of the sanctions have not been what Washington intended or expected.”
Both the Trump and Biden administrations approved over $60 billion in export licenses for transactions between US firms and Huawei, according to Congressional Research Service data—decisions that drew criticism from some lawmakers who questioned the effectiveness of restrictions with such extensive carve-outs.
- Federal bans prohibit agencies from buying Huawei equipment or contracting with entities that use it, with limited exceptions for operational necessity.
- The FCC banned new equipment authorizations in 2022, effectively closing the US market to future Huawei products.
- Huawei reported record 2024 revenue of $118.16 billion despite sanctions, with 71.4% from China.
- Export controls may have strengthened Huawei’s push toward technological self-sufficiency rather than weakening the company.
- Over $60 billion in licensed transactions between US firms and Huawei were approved despite Entity List placement.
What to Watch
The criminal case against Huawei, originally filed in 2019 with charges including sanctions violations and trade secret theft, is expected to proceed to trial in early 2026. The outcome could influence congressional appetite for additional legislative measures.
Watch for Pentagon waiver requests in the annual NDAA process. Defense officials argue operational requirements in regions where Huawei infrastructure is ubiquitous necessitate exemptions, setting up recurring conflicts with China hawks in Congress who view accommodation as strategic surrender.
The effectiveness of the “rip and replace” program bears monitoring. Congress appropriated $1.9 billion for rural carriers to remove Huawei equipment, but the FCC estimated actual costs exceed $5.6 billion. Two small carriers—SI Wireless and Blue Wireless—have already shut down, unable to afford the transition.