Chinese tech giant and the number 2 smartphone manufacturer globally, Huawei officially announced its business report for the first half of this year. And despite the worldwide pandemic along with the intense global scrutiny that the company has faced, Huawei clocked a 9.2% profit margin and a 13.1% increase of year-on-year revenue.
The tech giant’s revenue has reached 454 billion yuan (INR 4.88 lac crores), with the majority of it coming from the consumer business, which includes mobile phones, tablets, wearables etc. The company’s crown jewel, its carrier business, amounted for just about 35% of the total revenue, generating CNY159.6 billion. On the other hand, the consumer business took the charge of pushing Huawei’s revenue to such high numbers, registering about CNY255.8 billion. Lastly, the enterprise business made up for the smallest chunk, bringing in CNY36.3 billion in revenue.
Huawei has been bearing the brunt of a ban that was imposed on the Chinese telecom company last year by U.S., which later spread to a big chunk of the western hemisphere. Earlier in May, the US government introduced more hurdles for the company, banning Huawei from using any American technology for their production. This led to Huawei switching to HiSilicon – an in-house production chip unit, which, to put it lightly, isn’t the best in the market.
Moreover, just a few hours back, the UK barred Huawei from being a participant in the development of its 5G networks. All these incidents are linked with citations of national security and the anti-China sentiments.
Therefore, it is surprising that despite all these hurdles, Huawei claims that a steady growth has been possible due to ‘information and communications technology’. Last year after the Q3 results were announced, rotating chairman Eric Xu forecasted 2020 to be a ‘difficult year’. With that in mind, it’s commendable that Huawei has managed to slightly increase its profit margin from 8.7% last year to 9.2% this year. However, the sales growth of 23.2% is not an improvement, but still, impressive for a company that has been virtually banned from half of the world.
To maintain this hot streak, Huawei has to bet on its best horse. The company is one of the key players involved in the development of 5G tech globally, forcing even U.S., its biggest nemesis, to seek help from the telecom operator. Denying all of the security charges by several countries, and maintaining economic stability, they look forward to expanding their grip on 5G.