ARM is now following suit.
That's a more interesting one to consider in regards to long-term implications. They have CPU designs already. They can improve those themselves - albeit they won't be able to go to ARM for technical support anymore - but if ARM is obliged to revoke their ISA license then technically any new CPUs would be in violation and could be banned from US sales.
Suppose that they switched to MIPS or RISC-V, both of which are open source. That switch will take some time. Even an extremely competent team would need at the very least a couple of years to bring a new chip to production from scratch, and the first one wouldn't be anywhere near as good: bigger, slower, more power hungry.
So they would have a couple of years where they could be potentially banned from selling "violating" CPUs outside China - even though they were developed without further assistance from ARM - but then would not be able to field competitive home-grown alternatives.
But if the Chinese government decides to go all-in and bankrolls them through that tough patch they will come out the other side with viable products ... The natural response to which would have to be a blanket ban on buying Huawei products in the US. I wonder how hard the US can beat their supposed allies before they all say enough is enough?