US-based memory chipmaker Micron Technology downgraded its revenue outlook, as it expects a negative impact on sales in the first half of its fiscal 2021 after halting shipments to Huawei due to sanctions.

In an earnings call, president and CEO Sanjay Mehrotra said due to previously announced US restrictions, it stopped shipments to Huawei on 14 September: “Given that we only had a one month notice before halting shipments, we had limited ability to shift supply to other customers.”

Mehrotra said Huawei accounted for just under 10 per cent of sales in Micron Technology’s fiscal Q4 2020 which ended on 3 September, around $600 million, meaning the ban “clearly is a significant headwind to us” in fiscal Q1.

The company expects to offset the impact of the trade restrictions by the end of fiscal Q2. It forecasts DRAM shipments to be relatively flat and NAND shipments to grow “somewhat” in H1 2021 due to market conditions and the impact of the Huawei restrictions.

In August, the US ended a period of reprieves covering Huawei’s addition to a trade blacklist in 2019. Micron Technology is reportedly among several chipmakers to subsequently seek a licence to continue trading.

Mehrotra said its previous licences did not give it the ability to ship to Huawei from its non-US fabs: “We need new licences for that, which we have applied for, and we do not know if and when those would be granted.”

Net profit in fiscal Q4 increased 67 per cent year-on-year to $988 million, and revenue by 24 per cent to $6.06 billion.