A report in The Wall Street Journal said the cuts would take place at the company's R&D subsidiary Futurewei Technologies which employees about 850 people.
The newspaper cited anonymous sources as saying the numbers were in the hundreds, adding that some of the Chinese employees were being given the option of continuing to work with the company back in China.
Being placed on the Entity List means that components which have more than a certain percentage of content of American origin cannot be used by Huawei without permission.
Huawei was placed on the Entity List on 16 May. Five days later, the US Commerce Department said the ban would be eased for 90 days, so that existing networks and handsets which had already been sold by the Chinese firm would continue to receive software updates.
US companies, a number of processor manufacturers among them, have got around the ban by selling Huawei goods made by their branches in other countries.
US President Donald Trump has hinted on more than one occasion that Huawei could be used as a bargaining chip to settle the ongoing US-China trade war.
In June, Huawei founder Ren Zhengfei said the company's revenue was expected to fall to US$100 billion in 2019, compared to US$105 billion in 2018. In February, a target of US$125 billion had been set for the 2020 financial year.
Contacted for comment, a Huawei spokesperson said the company was not making any public comment on these claims.