China’s Huawei sees ‘business as usual’ as U.S. sanctions impact wanes

SHANGHAI, Dec 30 (Reuters) – Chinese tech giant Huawei Technologies Co Ltd (HWT.UL) estimated on Friday that its 2022 revenue was flat, suggesting that a drop in sales due to U.S. sanctions will s was arrested.

Although sales rose only 0.02%, rotating chairman Eric Xu struck an optimistic tone in the company’s annual New Year letter, where he revealed the figure.

“US restrictions are now our new normal, and we are back to business as usual,” Xu wrote in the letter to staff and released to media.

Revenue for the year is expected to be 636.9 billion yuan ($91.53 billion), according to Xu.

This represents a slight increase from 2021, when revenue reached 636.8 billion yuan, and marked a 30% year-on-year sales drop as US sanctions took effect. the company.

Xu’s letter did not mention Huawei’s profitability. The company typically releases its full annual results in the first quarter of the following year.

A person stands next to a Huawei sign during the World Conference on Artificial Intelligence, following the coronavirus disease (COVID-19) outbreak, in Shanghai, China, 1 September 2022 REUTERS/Aly Song

Revenue for 2022 remained well below the company’s 2019 record of $122 billion. At the time, the company was at its peak as the world’s top vendor of Android smartphones.

In 2019, the US Trump administration imposed a trade ban on Huawei, citing national security concerns, which prevented the company from using Alphabet Inc. (GOOGL.O) Android for its new smartphones, among other critical technologies of American origin.

The sanctions have caused sales of its cell phones to plummet. It also lost access to critical components that prevented it from designing its line of smartphone processors under its HiSilicon chip division.

The company continues to generate revenue through its network equipment division, which competes with Nokia (NOKIA.HE) and Ericsson (ERICb.ST). It also operates a cloud computing division.

The company began investing in the electric vehicle (EV) sector as well as green technologies around the time the sanctions took effect.

“The macro environment may be filled with uncertainties, but what we can be certain of is that digitalization and decarbonization is the way forward, and that is where the future opportunities lie,” Xu said in the letter.

Reporting by Josh Horwitz; Editing by Muralikumar Anantharaman

Our standards: The Thomson Reuters Trust Principles.

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