YTD, Huawei Outperforms the Telecommunications and Smartphone Industry
October 21, 2019
Huawei Technologies remains a force in the telecommunications and smartphone industries, despite the U.S. trade restrictions as third-quarter revenue rose to 165.29 billion yuan ($23.28 billion) up 27% Y/Y, driven by a surge in shipments of smartphones launched. The company's net profit margin in the period was 8.7%.
Huawei also announced that during the first three quarters of 2019 it generated CNY610.8 billion (US$86.05 billion) in revenues, an increase of 24.4% Y/Y. Huawei was all but banned by the United States in May from doing business with American companies, significantly disrupting its ability to source key parts, but was granted a reprieve until November, meaning it will lose access to some technology next month. Huawei has so far mainly sold smartphones that were launched before the ban. The Mate 30, which lacks access to a licensed version of Google’s Android operating system - started sales last month. In August The company said the curbs would hurt less than initially feared, but could still push its smartphone unit’s revenue lower by about $10 billion this year. YTD revenue for the first three quarters of the year grew 24.4% to 610.8 billion yuan. The company said it shipped 185 million smartphones so far this year a 29% surge in third-quarter smartphone shipments. The company, which is now trying to reduce its reliance on foreign technology, said last month that it has started making 5G base stations without U.S. components and is own mobile operating system as the curbs cut its access to Google’s Android operating system, though analysts are skeptical that Huawei’s Harmony system is yet a viable alternative. Promotions and patriotic purchases have driven Huawei’s smartphone sales in China - surging by a nearly a third compared to a record high in the June quarter – overcoming the shipments slump in the global market.