Huawei sees ‘complicated’ year ahead despite posting record group sales of US$121 billion on strong domestic sales of smartphones
- Net profit increased 5.7 per cent to 62.7 billion yuan for the year while the company said it invested 15.3 per cent of revenue in R&D
- Huawei’s annual revenue growth last year was slightly lower than the 19.5 per cent recorded in 2018
Huawei Technologies reported that revenue grew 19.1 per cent year on year to a record 858.8 billion yuan (US$121 billion) last year but said that Trump Administration curbs on its ability to do business outside China are biting and that its 2020 outlook amid the US sanctions and global coronavirus pandemic “will only get more complicated”.
Last year, revenue from China accounted for 59 per cent of total sales, driven by a domestic market growth rate of 36 per cent, almost double that of the global figure, indicating how difficult the international market has become for the Chinese telecoms giant amid the US pushback.
“Despite enormous outside pressure … Business remains solid,” Eric Xu, Huawei’s rotating chairman, said in a statement on Tuesday, adding that the “external environment will only get more complicated going forward”.
The Shenzhen-based company’s latest annual sales for the year ended December 31, up from 721.2 billion yuan in 2018, were driven by a jump in smartphone shipments in China and robust demand for its 5G networks, according to the statement.
However, given the challenges of a US trade ban issued in May 2019, Huawei saw its annual revenue growth come in slightly lower than the 19.5 per cent recorded in 2018, although it exceeded its 2017 growth rate.
Huawei’s key business segments – consumer, carrier and enterprise – produced revenue of 467.3 billion yuan, 296.7 billion yuan and 89.7 billion yuan respectively.