Huawei unveils new chip for flagship phone it hopes will compete with Apple - CNBC

Huawei's Kirin 990 5G chip

Elizabeth Schulze | CNBC

Huawei unveiled a new 5G processor for its mobile devices Friday, taking aim at competitors like Qualcomm and showing it will continue to bolster its chip technology amid political headwinds.

The Chinese tech giant showed off the new Kirin 990 5G chip at the IFA consumer electronics show in Berlin. Huawei said the processor will power its upcoming flagship smartphone called the Mate 30, which will be released later this month in a bid to rival Apple's expected new iPhones.

Huawei's announcement highlights the company's ambitions to take control of its supply chain amid political pressure from the U.S. Earlier this year, Huawei was put on a U.S. entity list that limits its ability to buy and license technology from American companies. The Chinese firm currently relies on American businesses for components in its devices like laptops and smartphones.

The Kirin 990 is an all-in-one artificial intelligence and 5G chip, which is also available in a 4G version. Huawei said the 7 nanometer chips are faster and more energy efficient than rivals' 5G processors, like Qualcomm's Snapdragon 855. Seven nanometer technology is the latest in the semiconductor industry and allows for smaller components that are more powerful and energy efficient than their predecessors.

"Kirin 990 reaffirms Huawei's chip and 5G ambition and will be an important factor in lowering the price of Huawei 5G devices," said Geoff Blaber, an analyst at CCS Insight, in an email to CNBC. "However, chipset progress does little to address the broader limitations caused by its U.S. entity listing. Qualcomm remains in pole position in taking 5G across a diverse range of devices and price points."

Huawei's Mate 30 smartphone will be unveiled at a September 19 event in Munich. But the launch could be marred by the fact that the U.S. entity list restrictions mean Huawei won't be able to license Google services. Huawei will look to use an open-source version of the Android operating system instead, a source with direct knowledge of the situation told CNBC last week. In addition, the company will still push ahead with an international launch of the device, the source said.

Tech companies like Huawei and Samsung are also increasingly developing more of their own chip technology to control costs and production amid slowing smartphone sales. Earlier this year, Apple bought Intel's wireless chip unit for $1 billion in a move analysts saw as a play to develop its own 5G chips.

5G wireless networks promise to speed up download times and enable devices to communicate more quickly between each other. So far, 5G's rollout has been limited in countries around the world. Samsung and Huawei, the two biggest smartphone sellers in the world, released their first 5G devices this year. Analysts expect Apple will release a 5G iPhone in 2020.

AirPods competitor

Huawei also released an updated version of its competitor to Apple's AirPods: the FreeBuds 3. The wireless earbuds will be powered by a new Huawei bluetooth chip called the Kirin A1.

Sales in Apple's wearables category which includes AirPods have surged in recent quarters, and Huawei looks like it wants a slice of that growth. The FreeBuds 3 will come in two colors: white and black. The company did not immediately disclose pricing and availability.

— CNBC's Arjun Kharpal contributed to this report

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