2020 was not an easy year for Huawei. The coronavirus pandemic and tougher US sanctions have prevented the Chinese company from achieving most of its goals and even forced the sale of the successful sub-brand Honor. However, Huawei not only managed to avoid a sharp drop in revenue, but also slightly increased its revenue.
Today, March 31, Huawei published its financial report for 2020. The company’s net profit for the reporting period was 64.6 billion yuan, or about $ 9.83 billion at the exchange rate. This is only 3.2% more compared to 2019. By the way, then the company’s profit grew by 5.6% compared to 2018. The consumer electronics business generated 482.9 billion yuan for Huawei in the 12 months of last year, up 3.3% from a year earlier. This business provided more than half of the company’s revenue. Huawei’s telecom division, which also manufactures 5G infrastructure networking equipment, earned 302.6 billion yuan last year, up 0.2% year on year. The largest revenue growth was demonstrated by the corporate segment of the company – by 23% compared to 2019. But still, this direction brings the company the least income – 100.3 billion yuan in 12 months.
Interestingly, operating cash flow last year declined 61.5% to RMB 35.2 billion. But Huawei explains this by an increase in spending on research and development work (R&D) as well as on the creation of warehouse stocks of components. The company invested 141.9 billion yuan in R&D last year, up from 131.7 billion yuan in 2019.
“Last year we resisted adversity. In 2020, we are faced with a slowdown in growth and we have had a hard time. The US sanctions have affected our consumer business, especially the smartphone business, ”said Huawei’s current CEO.
He did not elaborate on exactly how much revenue from smartphone sales fell, but noted that the decline was offset by a 65 percent increase in sales of other electronics, including smartwatches and laptops. Supported Huawei and the Chinese home market. The company’s revenue in the Middle Kingdom increased by 15.4% to 584.9 billion yuan. But in the rest of the regions, Huawei’s financial performance went down. Thus, in Europe, Africa and the Middle East, revenues fell by 12.2% to 180.8 billion yuan, in Asia – by 8.7% to 64.4 billion yuan, and in the Americas – by a record 24. 5% to 39.6 billion yuan. With what it is more connected – with the impact of the coronavirus pandemic or geopolitical factors – the head of Huawei cannot say.
However, Huawei is forecasting growth in sales of its devices and services in overseas markets in 2021. And the Chinese company is not going to give up.
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