Huawei’s struggles amid U.S.-China trade tensions have it looking for opportunities in other smart devices, pitting it against a slew of hardware makers at home and abroad.
The Chinese tech giant reported weak revenue growth in 2020, climbing just 3.8% to 891.4 billion yuan ($136 billion), as its net profit rose 3.2% to 64.6 billion yuan. The results were in line with Huawei’s forecast, the company said Wednesday at its annual report day in Shenzhen, a rare opportunity to get a glimpse of the private entity’s finances.
To compare the numbers, Huawei’s revenue grew by 19% and 19.5% in 2019 and 2018, respectively.
The slowdown in 2020 was mainly due to a slump in Huawei’s overseas smartphone sales after U.S. export controls cut off the company from core chipsets and essential consumer Google services. But the challenge has also quickened the company’s pace to diversify and make up for losses in its phone business.
Over the past two years, Huawei has stepped up its efforts in a host of smart devices, including AR/VR headsets, tablets, laptops, TVs, smartwatches, speakers, headphones, and headphones. embedded systems.
Huawei’s foray into the automotive industry has drawn particular attention as the global smart vehicle industry is booming. Reuters recently reported that Huawei would produce its own branded cars, which the company denied. At today’s event, the company’s rotating chairman, Ken Hu, reiterated that Huawei will play to its own strength and provide only certain car components and services, such as in-car operating system and the smart cockpit.
Huawei’s connected product matrix is reminiscent of Xiaomi’s IoT strategy built around its smartphones and operating system, with the difference that Huawei is also a telecom infrastructure provider.
Despite the steps taken by a few countries, such as the UK, to exclude Huawei from their 5G rollout plans, Huawei’s carrier segment in 2020 generated revenue equivalent to that of the previous year. The COVID-19 pandemic has been a boon for the company, said Hu, which has seen global demand for network solutions increase as people work and learn from home.
Huawei’s IoT push has shown some early traction, but the competition is fierce. Smartwatches, he said, had been one of his main revenue drivers since last year.
Globally, Apple has maintained its leading position in wearables with 34.1% of the market in 2020, according to research firm IDC. Huawei ranked third with 9.8%, behind domestic rival Xiaomi, which accounted for 11.4% of total shipments last year.
Overall, Huawei relied heavily on its home market to support its growth in 2020. China accounted for 65.5% of its total revenue, growing 15.4% year-on-year. Meanwhile, the company’s revenue fell 12.2% in Europe, the Middle East and Africa, 8.7% in the rest of Asia and 24.5% in the Americas.