Economy News Shares Technology

Huawei revenues down due to China-US tensions


Huawei is at the center of a technological rivalry between China and the United States, which suspect it of spying for Beijing.

Huawei reported a 38 percent drop in second-quarter revenue on Friday, according to results released by the Chinese telecom giant.

The company is at the center of an intense technological rivalry between China and the United States, which suspect it of potential spying for Beijing. Huawei was blacklisted by the former Trump administration, which prohibited U.S. companies from selling it sensitive technology, including microprocessors.

In addition, the Chinese group is cut off from Google’s Android software, which runs on its smartphones. The current administration of President Joe Biden has not altered U.S. policy towards Huawei.

In this context, the Chinese group reported Friday a turnover of 320.4 billion yuan for the first half of the year, down 29% year-over-year. The profit margin reached 9.8%, according to a statement from the company, which did not provide financial results for the period.

Including the results announced for the first quarter, second-quarter revenue was 168.2 billion yuan, down 38% year-on-year. Sales of consumer products, which include cell phones, fell 47% year-on-year to 135.7 billion yuan.

As a result of U.S. sanctions, Huawei has strategically refocused on software, enterprise computing, and smart vehicles. “Our goal is survival,” one of the group’s rotating presidents, Eric Xu, said in a statement. “We have been through a difficult time and all of our employees have kept moving forward with great strength and determination.”

In early 2020, Huawei was the world’s leading smartphone manufacturer. Despite being knocked out of the top five in the world in the sector by Washington, it continues to dominate the Chinese market, research firm Canalys reported.

The world’s leading equipment manufacturer for 5G, the fifth generation of mobile internet, Huawei has seen its development also hampered by pressure from the United States, which is trying to convince its allies to ban the Chinese group. The sales in this sector fell by 14.2% year-on-year to 136.9 billion yuan in the first half of the year.

For MetaNews.


Jonathan Hobbs

Jonathan Hobbs is an Australian investor and author that trades on a variety of asset classes, including currencies, equities, and commodities. Jonathan’s experience as a macro trader leverages his unique writing style to combine important elements, such as technical analysis and news. The other elements that he brings into his unique writing styles are foundation analysis aimed at rational equilibrium values, evaluating the sizes and motivations of buyers and sellers, as well as identifying the needs of the buyers and sellers in the individual markets. Jonathan is committed to quality writing for new traders as well as veterans.

Related Posts