Huawei revenue slides in Q3 as smartphone business remains crippled – Reuters

A Huawei logo is seen on a cell phone screen in their store at Vina del Mar, Chile July 18, 2019. REUTERS/Rodrigo Garrido
SHENZHEN, China, Oct 29 (Reuters) – Revenue of China's Huawei Technologies Co Ltd (HWT.UL) plummeted 38% in the third quarter compared to the same period a year earlier, with U.S. sanctions having hobbled its smartphone business and new potential growth areas still in their infancy.
The Chinese telecoms giant posted revenue of 455.8 billion yuan ($71.32 billion) for the first three quarters on Friday, down by almost a third on the same period a year earlier, with a profit margin of 10.2%.
Revenue for the third quarter alone came to 135.4 billion yuan, based on Reuters calculations.
Performance was "in line with forecast", said rotating Chairman Guo Ping.
Former U.S. President Donald Trump put Huawei on an export blacklist in 2019 and barred it from accessing critical U.S.-origin technology, impeding its ability to design its own chips and source components from outside vendors.
The restrictions have badly hurt Huawei's handset business, with rotating Chairman Eric Xu saying in September that revenue from smartphones would dip by around $30 billion to $40 billion this year. read more
While Huawei did not break down its third quarter figures by business segment, the company said that the decline is mainly attributable to its consumer business.
Huawei occupied 8% of China's smartphone market share in the third quarter, down from 30% a year earlier when it was the market leader, according to Counterpoint Research.
On the other hand, Honor, formerly a sub-brand which Huawei sold to keep it alive last November, sold 96% more phones in the same quarter compared to a year earlier, grabbing a 15% share of the China market, Counterpoint said.
Huawei is looking to develop new growth revenue streams outside of base station infrastructure and handsets, with a cloud business, and smart ports, mining and smart electric vehicles businesses.
In June it launched its Harmony operating system on smartphones, and is looking to supply software to autos companies.
But these new lines will take some time to bear fruit, executives said.
The company, however, has received a boost from the return of its chief financial officer and daughter of its founder Ren Zhengfei. Meng Wanzhou returned to work at its headquarters on Monday after almost three years fighting extradition to the U.S. in Canada, with Chinese officials signalling the case against her had been dropped to help to end a diplomatic stalemate. read more
($1 = 6.3910 Chinese yuan renminbi)
Our Standards: The Thomson Reuters Trust Principles.
Subscribe for our daily curated newsletter to receive the latest exclusive Reuters coverage delivered to your inbox.
Reuters, the news and media division of Thomson Reuters, is the world’s largest multimedia news provider, reaching billions of people worldwide every day. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers.
Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology.
The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs.
The industry leader for online information for tax, accounting and finance professionals.
Information, analytics and exclusive news on financial markets – delivered in an intuitive desktop and mobile interface.
Access to real-time, reference, and non-real time data in the cloud to power your enterprise.
Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks.
All quotes delayed a minimum of 15 minutes. See here for a complete list of exchanges and delays.
© 2021 Reuters. All rights reserved

source