Huawei rotating chairman Guo Ping has stated in an annual internal New Year’s message, that even though its carrier business remained stable and enterprise segment booked solid growth in 2021, total revenue was expected to drop 28.9 per cent year-on-year to CNY634 billion (US$99.9 billion).
He noted that turnover in the final quarter continued to be hammered by US trade sanctions on its consumer business, with smartphone sales plummeting after the divestment of its sub-brand, Honor.
Guo acknowledged 2022 will come with its “fair share of challenges”, explaining a changing external environment won’t cause it to alter its “ideals or aspirations.
“We will continue investing in the future and creating value for our customers and partners,” he said.
He noted cost-cutting won’t pave the way to sustainable survival: “Only through strategic investment can we grow stronger and build a future for ourselves.”
The Huawei chief added its device business expanded swiftly into new business domains in which its ability to secure chip supplies is not restricted.
With trade restrictions and equipment bans in many countries curbing its core telecom and handset businesses, the company has diversified into the automotive sector. Last week, it said the first electric car with its HarmonyOS operating system would begin deliveries in February.
It is also going to software manufacture and energy technology, as well as several other areas to shore up its revenue as device business continues to plummet.
In a statement, Huawei chief representative to the EU Institutions, Tony Jin noted the company ranked as the second highest private-sector investor in R&D in the world, citing data from the European Commission Industrial R&D Investment Scoreboard 2021.
R&D spending in 2020 reached CNY141.9 billion (over US$1.2 billion) representing 15.9 per cent of total revenue.