Huawei said on Friday that its first-half net profit fell by more than half as a difficult economy slashed customer demand, compounding problems caused by restrictions imposed by the United States.
Revenue fell 5.9% year-on-year over the period to 301.6 billion yuan ($44.73 billion), with a steepest decline between January and March.
“While our device business has been heavily impacted, the information technology infrastructure area has maintained steady growth,” said Ken Hu, Huawei’s rotating president, referring to the enterprise business unit.
The Chinese tech company’s profit margin fell to 5%, with net profit of 15.08 billion yuan, according to Reuters calculations, down from 31.39 billion in the first half of 2021.
Revenue from the company’s devices business that sells smartphones and laptops fell by more than a quarter to 101.3 billion yuan. Businesses aimed at telecom operators and companies saw growth.
Smartphone sales in China in the second quarter were down 14.2% from a year earlier, while volumes hit the lowest level in a decade, Counterpoint Research said last month.
The United States placed Huawei on an export restricted list in 2019 that prevents it from accessing critical US-sourced technology, crippling its ability to design chips and supply components that use parts produced abroad.
The ban hit the company’s once-dominant cell phone business, which is building new lines of business, including components for smart cars and energy-efficient systems.
The cloud computing services business took up 18% of China’s growing market, according to consultancy Canalys.
Huawei also released its own operating system, Harmony, which is now being used on 300 million of the company’s devices.
“We will take advantage of the digitization and decarbonization trends to continue creating value for our customers and partners and ensure quality development,” said Hu.
Source: CNN Brasil
