San Diego-based chip maker Qualcomm Inc. QCOM 0.98% provides at least eight of 25 key components on the device's main circuit board, ABI said, making it the biggest supplier of those parts. They include the modem and the power-management unit, which directs the flow of electricity through the device. Other key components come from SanDisk Inc., a flash-memory supplier based in Milpitas, Calif., and Skyworks Solutions Inc., SWKS -1.22% a Woburn, Mass., chip maker, ABI said. The protective glass on the phone's display is supplied by Corning Inc., GLW -0.50% the maker of Gorilla Glass, which is also used in Apple Inc. devices. Corning is based in New York state.
The lapse could leave some consumers with inoperable devices, according to a person familiar with the matter. The Shenzhen-based company has sold nearly 25 million smartphones in the U.S. since the start of last year, according to Canalys, a research firm. Some of those customers have taken to social media to vent frustration over the inability and lament that they may have to dump their ZTE models and switch to other brands. For ZTE and its customers, a tweet Sunday from President Donald Trump stating that he is working with China's president to keep ZTE in business offered a ray of hope, though it's unclear if or how soon ZTE will get a reprieve. Trump's intervention underscored how ZTE has become a political bargaining chip in ongoing U.S.-China trade discussions, and is likely to figure in talks set for this week in Washington between the two sides.
That success came on the back of strong shipments in China, where consumers are used to using alternatives to Google software. The company has developed its own ecosystem of smartphone apps to replace Google Mobile Services, the software bundle that includes the Play app store, Google Maps and other popular apps. Richard Yu, the head of Huawei's consumer-electronics business, said Thursday that the company would go a step further by selling smartphones running its self-developed operating system, called "Harmony OS." Huawei first announced the operating system last year, but it currently runs only on Huawei's line of other smart devices. Mr. Yu said the beta version of Harmony OS for smartphones would be made available to app developers in China by the end of the year. He spoke at Huawei's annual developers conference at a basketball arena in Dongguan, in southern China.
To clear the path to an agreement, ZTE has gone on the offensive to remedy its failures to meet the conditions set by the Commerce Department under a settlement of a probe into the company's evasion of American sanctions on Iran and North Korea. ZTE has stripped responsibilities and job titles from a clutch of senior employees, issued letters of reprimand, and is attempting to claw back bonuses from 35 people, one person said. Time is short for ZTE. It is facing a flurry of demands for compensation from foreign telecom network operators whose projects have stalled without supplies from ZTE, the people said. Even if U.S. companies resume shipments to ZTE, the Chinese company must win back customers and shake off damage to its reputation from the episode.
This picture taken on May 3, 2018 shows the ZTE logo on an office building in Shanghai. The heated trade dispute between the U.S. and China has claimed its first victim, with China's ZTE crippled by trade tensions while reeling from repercussions that could cost the firm dearly in the long run. The Shenzhen-based telecommunications giant had halted all major operations after the Trump administration, citing violations of a recent sanction settlement, banned it from purchasing American components and services, which are vital to making smartphones and other telecom gears. Though things made a turn for the better on Monday, with President Trump tweeting that he is working to give ZTE "a way to back into business," the company has already suffered mounting losses. Some of its long-time customers are scaling back deals with ZTE, amid worries over whether it can guarantee supply.