Huawei’s steady decline continues

Chinese vendor Huawei has issued one of its minimal quarterly numbers bulletins and it reveals yet another fall in revenues.

For Q1 2022 Huawei says it brought in CNY131 billion in revenue, with a net profit margin of 4.3%. That’s all you get, no segmentation, year-on-year comparisons, or anything like that. Thankfully we wrote an equivalent report a year ago, which allows us to calculate that Huawei’s most recent revenues declined 14% YoY. Margin, meanwhile was 11.1% back then.

Such declines stopped being remarkable some time ago and are to be expected when much of your business is hamstrung by hostile foreign intervention. So the main interest at this stage lies in seeing when, if at all, the decline will stop. The obvious floor is presented by Huawei’s unassailable position in the networking sector of its domestic market, but the company aspires to much more than that.

“In Q1, our overall business results were in line with forecasts,” said Ken Hu, Huawei’s Rotating Chairman. “Our consumer business was heavily impacted, and our ICT infrastructure business experienced steady growth. We have yet again increased our investment in R&D to harness the momentum of our innovation and create new value for customers.

“As always, we want to thank our customers and partners for their ongoing trust and support. In 2022, we still face a challenging and complicated business environment. Despite considerable operational challenges, we will work more closely with our customers and partners around the world to overcome adversity.”

He’s obviously talking about the US. Having the majority of my far the biggest telecoms infrastructure to count on is a nadir most companies would kill for. So it’s tough to feel too sorry for Huawei, despite the apparent injustice of much of its treatment. You have to assume the US will eventually resolve its differences with China, at which point Huawei is positioning itself to pounce. That moment could be a long time coming, though.

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One comment

  1. Avatar Happiman 03/05/2022 @ 1:44 am

    EVentually evil empire will fail.

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