Huawei expects 2021 revenue to drop by 28.9% as sanctions drag on

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  • Chinese telecommunications giant Huawei said on Friday it expects revenue this year to come in at 634 billion yuan ($99 billion), down 28.9% from a year ago.
  • Friday’s release came as part of an internal New Year’s message from Huawei Rotating Chairman Guo Ping, who focused on rallying employees to press.
  • The company has faced US sanctions, semiconductor shortages and a global slowdown in smartphone demand.

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BEIJING — Chinese telecommunications giant Huawei said on Friday it expects revenue to come in at 634 billion yuan ($99 billion) this year, down 28.9% from a year ago.

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The company has faced US sanctions, semiconductor shortages and a global slowdown in smartphone demand.

Full-year estimates for 2021 indicate that Huawei’s revenue for the second half of the year fell to 313.6 billion yuan from 320.4 billion yuan in the first six months.

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The company reported 891.4 billion yuan in revenue in 2020, a 3.8% increase over the previous year. This is much slower than the 19.1% year-on-year growth reported for 2019, with revenues of 858.8 billion yuan.

Friday’s release came as part of an internal New Year’s message from Huawei Rotating Chairman Guo Ping, who focused on rallying employees to press.

The letter did not specify the reasons for the expected revenue decline, but noted “serious challenges” from “the unpredictable business environment, the politicization of technology, and the growing disinformation movement”, according to an English-language version seen by Businesshala. went.

Guo said that “this past year, our carrier business remained stable, our enterprise business experienced solid growth, and our device business expanded rapidly into new business domains.”

For the next year, Guo said the company’s objectives include increasing efforts to create and attract talent, and develop automotive-related technologies.

Last week, Huawei announced that deliveries of its first electric car with the HarmonyOS operating system are likely to begin in late February.

Huawei usually releases its more detailed annual reports in March.

Data released for the first half of 2021 showed that the two largest business segments, consumers and carriers, saw a sharp year-on-year decline. Very small enterprise business, which has become the focus of Huawei’s growth strategy, grew by 6.6 billion yuan.

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In 2019, the administration of former President Donald Trump put Huawei on a blacklist that banned US companies from selling technology to the Chinese company, citing national security concerns. Huawei has denied such threats.

While those restrictions have not been eased, there are other tensions between Huawei and the US government.

Founder Ren Zhengfei’s daughter, CFO Meng Wanzhou, returned to work at the company’s headquarters in Shenzhen after reaching a settlement with the US government regarding allegations of wire fraud.

Meng had fought extradition to the US from Vancouver, where he was arrested in December 2018. He spent most of the past three years under house arrest, in which his 10 million Canadian dollar ($7.9 million) bail terms allowed him to venture out. Days with security tracking.

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