Huawei Reports Biggest Revenue Drop Ever

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Chinese manufacturer Huawei Technologies reported on Friday (6) its biggest revenue drop of all time, when presenting results for the first half of 2021. The 29.4% drop compared to the same period last year is attributed to the sanctions imposed by the US government since the beginning of the so-called “trade war with China”.

According to the data released, Huawei’s revenue for the period ended June 30 fell to 320.4 billion yuan (R$260 billion) from 454 billion yuan in the first half of last year. Largely responsible for the fall was the sale of subsidiary Honor, maker of low-cost smartphones, to free it from international sanctions.

Sales of Huawei’s consumer unit, including smartphones, plunged 47% compared to figures reported in the first half of 2020. As for network equipment and other technologies for telephone companies, sales fell 14.2%, but the business unit’s revenue increased by 17.2%.

Huawei’s expectations

Eric Xu, one of the three executives who take turns as chairman of Huawei’s board of directors, said in a statement that the Chinese giant’s current goal is “to survive and do this sustainably.” having suffered a decline “due to external factors”, the company bets on the operators and telephony sector.

While it has not released information on its earnings, Huawei said its current net margin is 9.8%, down from 11.1% in the first quarter of the year.

On the sensitive issue of the lack of chips, the company said it has a stock of these components, made in the US, but executives recognize that they are running out. The development of its own chip is bumping up against US technology supply blocks, which prevents access to inputs for its production.

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