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Broadcom injured by Trump moving toward Huawei on China trade



Broadcom's CEO, Hock Tan, pays the cost of the misconduct of President Donald Trump's promise to "bring the Chinese to their knees," said CN Cracker Jim Cramer on Friday.

Trump feels he must "sacrifice Broadcom on the Huawei altar" to humiliate China in trade negotiations, Cramer claims. Last year, Broadcom received about $ 900 million in revenues from China-based Huawei, a major manufacturer of smartphones and mobile networking equipment.

"The president welcomes Huawei as Achilles" by Chinese leader Xi Jinping. The calculation that Blacklisting Huawei can effectively do business with US companies is that China would never let one of its crown jewels of technology fail, but the speculator "Mad Money" speculated.

Tan can feel hard done by Trump, said Cramer, pointing out that Broadcom CEO in 201

7 went to the White House and came to the president to announce that he moved the Singapore-based company back to the United States.

In another bank watch, Trump's administration last year blocked Broadcom's $ 117 billion bid to buy San Diego-based Qualcomm for national security reasons.

"What a death kiss, if you're a good friend with the president," Cramer said on "Squawk on the Street."

"Broadcom is a remarkably good company, and it is going to be damaged" at the junction of the world's two largest economic superpowers, he explained.

Shares in Broadcom fell sharply on Friday's opening on Wall Street, after the semiconductor manufacturer reported a quarterly revenue on Thursday weaker than expected. It also announced a forecast return of 2019, which predicts a decline in demand as a result of the Washington-Beijing conflict. This is "driven by continued geopolitical uncertainties," Tan said in a statement.

The company also sees "the effects of export restrictions on one of our largest customers," added Tan, in a reference to the Trump administration last month, which excludes Huawei without special permission from buying US equipment. The Ministry of Commerce, however, set a 90-day move on the move.

The White House has accused Huawei of being too closely linked to China's Communist government and expressed concern about the Huawei technology used to spy on the United States For its part, Huawei has repeatedly claimed to be independent of the Chinese government .

A White House spokesman was not immediately available to respond to CNBC's request to comment on Cramer's remarks.


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