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Best Buy to Stop Selling Huawei Phones

A consumer tries out an Huawei brand smartphone in a Best Buy Inc. store in New York. The retailer plans to stop selling phones made by the Chinese tech giant.
A consumer tries out an Huawei brand smartphone in a Best Buy Inc. store in New York. The retailer plans to stop selling phones made by the Chinese tech giant. Photo: Richard B. Levine/Zuma Press

Best Buy Co. BBY -0.38% plans to stop selling phones in the U.S. made by Huawei Technologies Co., according to a person familiar with the matter, the latest blow for the Chinese cellular-electronics giant in the U.S.

Best Buy will cease selling Huawei phones in the next few weeks, this person said. Best Buy is one of several U.S. retailers, including Amazon.com Inc., that sell Huawei phones.

Huawei is the world’s third-largest smartphone vendor by units shipped, but its share of the U.S. smartphone market has been tiny since a 2012 congressional report advised carriers against doing business with the Chinese tech giant over security concerns. Huawei has denied it is a threat. The report has made it difficult for Huawei to secure partnerships with the carriers that dominate access to the U.S. phone market.

Huawei ranks 14th in U.S. smartphone market share, with 0.2% of smartphones shipped in 2017, according to research firm IDC. Huawei also runs a lower-end brand called Honor, which has 0.1% of the U.S. market share for smartphones shipped in 2017.

In a statement, Huawei said it “values the relationship it has with Best Buy and all our other retail partners. As a policy, we do not discuss the details of our partner relationships.”

CNET on Wednesday reported on Best Buy’s decision.

The decision is the latest blow to Huawei in the U.S. In January, AT&T Inc.dropped plans to sell Huawei phones in the U.S. Earlier this month, President Donald Trump scuttled a proposed $117 billion takeover attempt by Broadcom Ltd. of rival chip firm Qualcomm Inc. after a government advisory panel said the deal would hamper Qualcomm’s edge in wireless technology research against Huawei.

U.S. intelligence leaders have recently recommended against Americans using phones from Huawei or Chinese rival ZTE Corp. The most recent to do so was Paul Nakasone, the nominee to head both the National Security Agency and U.S. Cyber Command, who said at a Senate hearing last week that he wouldn’t want his friends or family using such devices.

In addition to selling smartphones, Huawei is the world’s top maker of the equipment that goes into cellular towers and related infrastructure. The U.S. government’s broad concern is that the Chinese government could order Huawei to exploit knowledge of how its electronics are designed to spy or launch cyberattacks. Huawei says it is employee-owned and that no government has ever asked it to spy on or sabotage another country.

Write to Dan Strumpf at daniel.strumpf@wsj.com and Stu Woo at Stu.Woo@wsj.com

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https://www.wsj.com/articles/best-buy-to-stop-selling-huawei-phones-1521725835

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