China’s AI champion iFlyTek brushes off US entity list inclusion with bullish profit forecast

iFlyTek said it expects to report a net profit of US$46.4 million to $53.4 million for the first three quarters of 2019

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iFlyTek CEO and founder Liu Qingfeng. Photo: Handout

Published: 12:01pm, 10 Oct 2019Updated: 10:26pm, 10 Oct 2019

China’s voice recognition champion iFlyTek said it will maintain healthy growth this year despite being added to a US trade blacklist on Monday as the company announced a positive profit forecast for the first three quarters of the year.

Along with 20 Chinese public security bureaus and seven other companies, iFlyTek was added to the US Entity List which prevents them from buying US-made technology. Washington’s move was linked to Beijing’s alleged treatment of Uygur Muslims and other predominantly Muslim ethnic minorities and the involvement of the Chinese tech companies in that campaign.

iFlyTek chief executive Liu Qingfeng addressed the impact of the ban in an open letter to staff on Wednesday, saying: “We have the world's leading artificial intelligence core technology, all of which come from our independent research and development, and have independent intellectual property rights. We will not be strangled.”

On Thursday iFlyTek said it expects to report a net profit of 330 million to 380 million yuan (US$46.4 million to $53.4 million) for the first three quarters of 2019, representing year on year growth of between 50 and 73 per cent.

The profit growth mainly relied on the healthy development of its core business amid a complicated economic environment both at home and abroad, the company said in a statement.

Liu said that being blacklisted by the US would not have a significant impact on the company’s day-to-day operations though iFlyTek will appeal to the relevant US government departments and will keep an open mind in future.