WASHINGTON, March 12 (Reuters) - Intel ( INTC ) has survived an

effort to halt hundreds of millions of dollars' worth of chip

sales to Huawei, two people familiar with the matter said,

giving one of the world's largest chipmakers more time to sell

to the heavily sanctioned Chinese telecoms company.

U.S. President Joe Biden has long been under pressure to

revoke a license, issued by the Trump administration, that

allows Intel ( INTC ) to ship advanced central processors to

Huawei for use in laptops.

The push came from Intel ( INTC ) rival Advanced Micro Devices ( AMD )

, which argued it was unfair that it did not receive a

license to sell similar chips to Huawei and from China hawks,

who are seeking to stop all sales to the Chinese firm.

Intel's ( INTC ) ability to hang on to a license to sell chips while

a rival could not obtain similar permission demonstrates the

uneven and uncertain terrain companies face as the U.S. seeks to

limit Beijing's access to sophisticated American technology,

especially to a heavily sanctioned company like Huawei.

It has also allowed Huawei to keep a small but growing share

of the global laptop market, while AMD was deprived of hundreds

of millions of dollars' worth of sales to the Chinese sanctioned

firm, data showed.

"The majority of the CPUs used in Huawei's laptops is still

from Intel ( INTC ), so any further limitation on it would make Huawei's

laptop offering quite challenging," said Emma Xu, an analyst

with technology market research firm Canalys.

Intel ( INTC ), Huawei, the Commerce Department and the White

House declined to comment. AMD did not respond to a request for

comment. Describing the curbs on Huawei as economic bullying,"

the Chinese Embassy in Washington urged the United States to

"stop overstretching the concept of national security" to

"suppress Chinese companies."

Huawei, a symbol of the years-long technology war

between Washington and Beijing, was added to the trade

restriction list by the Trump administration in 2019 over

alleged sanctions violations. Huawei has previously denied

wrongdoing.

Being added to that list usually bars U.S. suppliers from

selling anything to the targeted company.

But in late 2020, just before former President Donald Trump

left office, the Commerce Department granted some U.S. Huawei

suppliers -- including Intel ( INTC ) -- special permission to sell

certain items to the telecoms equipment giant.

AMD applied for a license to sell similar chips in early

2021 after President Joe Biden took office but never received a

response to its application, a source said.

Reuters could not determine why Intel ( INTC ) was granted its

license and AMD was not. But the impact on CPU chip sales to

Huawei was immediate, with the share of sales of Huawei laptops

containing AMD chips plunging from 47.1% in 2020 to 9.3% in the

first half of 2023, an internal AMD presentation with data

sourced to NPD and GfK showed.

Intel's ( INTC ) share of sales of Huawei laptops containing its

chips soared during the period from 52.9% to 90.7%, according to

the presentation.

That left the two companies with upwards of a $512

million dollar "estimated revenue discrepancy" by early 2023,

according to the presentation.

Circana, the company created last year from the merger of

NPD and IRI, and GfK, which is now owned by NIQ, declined to

comment.

The push to revoke licenses appeared likely to bear fruit

last year when a government official said publicly that Huawei's

licensing policy was under review and privately told companies

the Commerce Department would fix the licensing discrepancy,

sources said.

But by late last year, the agency had shelved plans to

revoke licenses, without providing a reason, said a person

familiar with the matter and a U.S. official, who stressed the

plan could be revived at a later date.

Reuters could not learn why the Commerce Department shelved

its plans to revoke Intel's ( INTC ) license.

But the action came as Washington took pains to reset

relations with Beijing, including reestablishing

military-to-military talks, after a Chinese spy balloon's

discovery in U.S. airspace last winter soured relations between

the two superpowers.

Intel's ( INTC ) license is expected to expire later this year, and

is unlikely to be renewed, sources said. Meanwhile, Huawei

continues to rely heavily on Intel ( INTC ) chips for its laptops, its

website shows.

In China, Huawei's share of sales has grown from 2.2% in

2018 to 9.7% for 2023 when it replaced Dell as China's third

largest laptop manufacturer, according to Canalys.