The Chinese group was able to stop the fall in its turnover caused by the collapse of its sales of smartphones. The company is getting away with the diversification and its position as a world number one of telecommunications equipment.
by Simon Leplâtre (Shanghaï, Correspondence)
The year 2019 was dark for Huawei. A year after the arrest of Meng Wanzhou, daughter of the founder of the Chinese telecoms group, the company was placed on an American black list: it was forbidden to buy the slightest component – electronic chips, for example – in States -United. After three years of fall in turnover, Huawei raises his head.
At the end of October 2022, the world number one telecoms, and ex-numéro two of the smartphones, published upward results for the second quarter in a row, a sign that the new activities developed by the company are starting to pay. The group stresses that its sales of telecommunications network equipment has progressed, while the fall in its sales of consumer devices (smartphones, mainly) could be hooked.
Huawei’s turnover increased by 6.5 %, reaching 144.2 billion yuan (19.5 billion euros) in the third quarter of 2022, according to figures published voluntarily by the company and Not subject to audit, the group not being listed on the stock market.
fall in turnover
Touched by a first volley of sanctions in 2019, Huawei had seen his turnover fall after a new salvo of restrictions, in 2020. This tightened even more the vice, by prohibiting any company using products (Components or software) American to collaborate with the Chinese group. The company then had to do without TSMC services, the world leader in the production of semiconductors, which manufactured the Kirin fleas, the Huawei subsidiary for flea design.
Already prevented from using Google’s services, Huawei smartphones, 5G deprived, therefore had to be satisfied with 4G, enough to cool consumers. Result, in 2021, a fall of more than 50 % of smartphones sales for the company (which competed Apple for the second place in the world behind Samsung), with a turnover down 28.6 %. The group had succeeded in maintaining profits by selling its brand Honor, which can thus escape American sanctions.
Investment in the Cloud
To survive these sanctions, Huawei has invested massively in new sectors, in which semiconductors are less essential. In the Cloud, the company progresses rapidly, in particular thanks to its good relations with the Chinese authorities: on the domestic market, the company occupies second place, behind Alibaba and before Tencent.
In addition, Huawei also offers solutions for the “smart city” and surveillance (cameras and software). The company has developed an operating system for connected cars, usable by any manufacturer, and pushes research on autonomous driving. Still on the automotive side, the group launched its own electric vehicle in September 2022.
The company also offers a wide range of connected objects, such as smart watches. At the same time, the company invests massively in the Chinese ecosystem of semiconductors, in the hope of being able to replace, in the long term, the American components. The Chinese delay in the matter is however colossal.