ZTE relies on an array of components for its smartphones and gears. And the immediate aftermath of the ban led to ZTE halting its major operational activities due to lack of supplies from U.S. firms. The company revealed this in a May 9 filing to the Hong Kong Stock Exchange.
The sale of smartphones on ZTE’s online stores has been suspended. A few local carriers continue to sell the devices in the retail outlets, but are running out of stock and are soon expected to halt their sales. This dire situation compelled ZTE to shelve the annual general meeting to late June. Initially, the meeting was to take place on May 11.
ZTE halting its major operational activities due to lack of supplies from U.S. firms. The company revealed this in a May 9 filing to the Hong Kong Stock Exchange.
Though ZTE received some relief from the Taiwanese Chip Supplier MediaTek, it failed to solve the larger problem of ZTE. This is because the Chinese telecom gear maker relies heavily on Qualcomm’s chipset for its high-end devices, which cannot be replaced by MediaTek.
Early this week, ZTE said in a filing that it requested the U.S. authorities to reconsider their decision on the ban as it severely damages their business. The U.S. Department of Commerce imposed a ban after they found that Chinese telecom giant was guilty of breaching trade sanctions by shipping products to Iran. This ban has further added to the trade tensions between the worlds’ two largest economies.