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Huawei Technologies bullish on soaring sales

PUBLISHED : Wednesday, 06 December, 2006, 12:00am
UPDATED : Wednesday, 06 December, 2006, 12:00am

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Mainland telecoms equipment maker believes strong Asia demand will boost handset business


Huawei Technologies, China's largest telecommunications equipment maker, expects its sales will jump 34 per cent to US$11 billion this year and a further 36 per cent to US$15 billion next year due to growing demand in Asia.


The company said it will sell 20 million handsets this year and expects to increase that by 50 per cent to 30 million units next year.


It also anticipates to sell 1.5 million wireless receiver cards for laptops but would not provide comparative data.


'We benefit from the strong growth in developing countries such as India, Pakistan, Indonesia and Bangladesh,' Huawei executive vice-president Guo Ping said yesterday at the ITU Telecom World 2006 conference.


Huawei, whose customers include Spain's Telefonica, BT Group, Vodafone Group and China Mobile, in June said sales grew 29 per cent to US$5.2 billion in the first half of this year from a year ago.


During the period, its sales in China slipped 10 per cent to US$1.8 billion, accounting for 35 per cent of revenue, while overseas sales jumped 36 per cent to US$3.4 billion, or 65 per cent of the total.


As a private company, it does not elaborate on its income.


For this year as a whole, overseas business should account for about 70 per cent of sales, 'so we absolutely need to work harder in our domestic sales', Mr Guo said.


He declined to comment on whether Huawei plans to list in Hong Kong, like its mainland rival, ZTE Corp.


ZTE, which tends to be more focused on emerging markets than its larger rival, in July said sales grew 1.8 per cent to 10.49 billion yuan in the first half but net profit fell 47 per cent to 347 million yuan due to a decline in its domestic business.


The key mobile service providers have been slowing their infrastructure investments in anticipation of the huge capital expenses that will be needed for the launch of third-generation technology.


Both Huawei and ZTE should see their sales soar when that happens, as early as the first quarter of next year.