Home Finance Huawei’s first quarter revenue tumbles as smartphone sales plunge

Huawei’s first quarter revenue tumbles as smartphone sales plunge

by Enochadmin

Huawei’s smartphone enterprise has struggled underneath U.S. sanctions that limit it from shopping for chips and different elements from key suppliers.

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BEIJING — Chinese language telecommunications large Huawei introduced Thursday that first quarter income fell by almost 14% from a yr in the past, whereas its revenue margin greater than halved.

“Our client enterprise was closely impacted, and our [information and communications technology] infrastructure enterprise skilled regular development,” Ken Hu, Huawei’s rotating chairman, stated in an announcement. “In 2022, we nonetheless face a difficult and complex enterprise surroundings.”

The corporate reported 131 billion yuan ($20.63 billion) in income for the primary quarter. That is down by 13.9% from the identical interval final yr, and a greater than 27% decline from the fourth quarter of 2021.

First quarter revenue margin of 4.3% was lower than half the 11.1% reported a yr earlier.

Hu stated the quarterly outcomes had been according to the corporate’s expectations and that Huawei has elevated its funding in analysis and improvement.

Huawei’s smartphone enterprise has struggled underneath U.S. sanctions. The Trump administration put the corporate on a blacklist that restricts it from shopping for essential elements similar to superior semiconductors from U.S. suppliers.

Smartphone gross sales in China throughout totally different manufacturers fell by 14% within the first quarter from a yr in the past, in response to Counterpoint Analysis.

Huawei logged the worst decline out of seven manufacturers, rating sixth by market share and with gross sales plunging by 64.2% from a yr earlier, the report confirmed. The corporate’s smartphone gross sales in China additionally fell by 12% from the prior quarter.

Apple was the one different firm on the record to submit a quarter-on-quarter gross sales decline in China, down by 23%, in response to Counterpoint. Nevertheless, the iPhone maker’s China gross sales nonetheless grew by 4.4% within the first quarter from a yr in the past.

Trying to different companies

Huawei has emphasised hiring expertise and growing different enterprise traces to counter the affect of falling smartphone gross sales.

Specifically, whereas the corporate stated it is not going to construct its personal automobiles, Huawei has entered the new electrical automotive market by incorporating its HarmonyOS working system and different expertise into automobiles manufactured by conventional Chinese language auto manufacturers.

Rotating chairman Hu stated earlier this week that no less than two extra automotive fashions utilizing Huawei expertise can be launched this yr. The primary automotive to make use of HarmonyOS was the Aito M5, which started deliveries earlier this yr.

Huawei stated its analysis and improvement workforce for sensible autos has reached 5,000 individuals, and that the corporate’s funding in auto tech-related operations reached $1 billion final yr.

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