SANTA CLARA (REUTERS) – Futurewei Technologies Inc, the US research arm of China’s Huawei Technologies Co Ltd, began laying off workers on Monday (July 22), according to employees including one who spoke to Reuters as he left the company’s Silicon Valley campus.

At least half a dozen staff with boxes were seen leaving the office before noon.

The layoffs come about two months after the Trump administration put Huawei on a trade blacklist, making it illegal for its US subsidiary to transfer sensitive technologies to its parent. The blacklist also restricts Huawei from purchasing products from US technology companies.

One employee, who declined to give his name, told Reuters he had been laid off. Putting a bag full of personal belongings into his car, he said he had been told the official announcement would come on Tuesday.

Huawei declined to comment.

Another Huawei employee told Reuters by telephone last week that the layoff target was to remove 70 per cent of the 850 Futurewei workers in the United States.

That employee said a layoff list had been sent from Huawei’s headquarters in China, and aimed to eliminate any open source projects, projects related to near-term Huawei products, and any research and development in critical technology.

Futurewei was set up in part to work closely with US universities and researchers.

Huawei is among the world’s largest telecommunications equipment manufacturers. The US Commerce Department in May placed the firm on its “entity list” of organisations that pose security risks. The Justice Department earlier filed charges against the firm alleging theft of trade secrets and other crimes.

Futurewei has offices in Silicon Valley and the greater Seattle, Chicago and Dallas areas. Futurewei has filed more than 2,100 patents in such areas as telecommunications, 5G cellular networks, and video and camera technologies, according to data from the United States Patent and Trademark Office.

A Futurewei employee not affected by the layoffs said work had come to a standstill since Huawei was blacklisted.

“On the 17th of May, Huawei asked everyone at Futurewei to upload everything to the Huawei cloud, right before the ban took effect,” that employee said.

“After that basically Futurewei has stopped doing any work – almost stopped everything.”

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