China's No 2 server maker, H3C Technologies, is implementing pay cuts for its mid-to-senior-level employees as a result of US tech sanctions [d56e3958]. The company will reduce the pay of employees and managers rated grade 17 and above by 20%, while employees and managers at grade 16 and all grade 15 managers will face a 10% cut. These adjustments will be effective from December 1 and will last until the end of next year, with the possibility of extension or early termination depending on the company's operating conditions. H3C Technologies, which is the second-largest server maker in China, has a workforce of over 19,000 and purchases chips from suppliers like Nvidia to make servers [d56e3958].
The pay cuts come in response to the impact of US export controls on Chinese businesses, particularly cloud service providers like Alibaba and Tencent. These companies have warned about the adverse effects of the restrictions on their operations. H3C Technologies, founded in 2003 as a joint venture between Huawei and 3Com, has experienced changes in ownership over the years and is currently 51% owned by Unisplendour, a listed arm of Tsinghua Unigroup [d56e3958].