The move would be prompted by complications surrounding Huawei's presence on the Commerce Department's Entities List, which bars US companies from doing business with a given firm unless there's explicit approval. Futurewei staff have been restricted when communicating with Huawei's Chinese offices, according to the tipsters, since their work might be considered US technology despite the corporate connection. Reuters contacts recently said that Futurewei was trying to separate its operations from Huawei proper as a result of the US blacklisting.

Huawei has declined to comment. If accurate, though, the job cuts could significantly hamper the tech giant's research efforts -- at least until it boosts R&D outside the US. It also underscores the toll the de facto ban is having on the company's business. Between this and talk of reduced phone production, Huawei may face tough times until and unless American officials give it a break.