Huawei’s growth slowed in 2020, with China accounting for a larger portion of its revenue as trade restrictions took a toll on its non-domestic performance.
In an earnings briefing, rotating chairman Ken Hu (pictured) noted the vendor’s revenue was still higher in 2020 despite an overall negative environment, hailing measures to diversify its supply chain along with heavy investment in R&D for the progress.
He noted disruption to global supply chains also affected its suppliers in the US, where it previously purchased components valued at $10 billion to $20 billion annually.
“For the industry it has been a lose-lose situation. It [is] very unfair and caused a lot of damage to us, and our upstream suppliers are also suffering.”
Net profit was 3.2 per cent higher at CNY64.6 billion ($9.86 billion), with revenue rising 3.8 per cent to CNY891.4 billion. The share of revenue from China increased from 59 per cent in 2019 to 65 per cent.
Revenue in China grew 15 per cent to CNY584.9 billion, but fell in all other regions, down 12.2 per cent to CNY180.8 billion in EMEA; 8.7 per cent to CNY64.4 billion in Asia Pacific; and 24.5 per cent in the Americas to CNY39.6 billion.
In 2019, Huawei booked a 5.6 per cent increase in profit and 19.1 per cent rise in revenue.
Hu said its smartphone business “fell short of expectations”, as it was impacted by a shortage of components caused by “unfair” US sanctions. But he noted its Consumer Business Group revenue was up 3.3 per cent to CNY482.9 billion with the weakness offset by other devices including tablets, wearables, smart screens and PCs.
He said Huawei hasn’t been able to see a clear picture on the future of its smartphone business, making it hard to make forecasts. However, he asserted the vendor’s next flagship models will be released as planned, including the second generation of its foldable smartphone.
“The overall direction of our strategy has not changed. We will continue to push ICT infrastructure, as we see an inevitable trend towards digital transformation. We will also focus on improving the consumer experience across different platforms”.
Revenue at its carrier group was flat at CNY302.6 billion, with enterprise up 23 per cent to CNY100.3 billion.
R&D investment stood at $21.8 billion, 15.9 per cent of overall revenue, and 3,000 staff were added taking its global total to 197,000.Subscribe to our daily newsletter Back