Huawei expects 30% drop in 2021 revenue and challenges ahead

Telecoms equipment maker Huawei Technologies, battered by U.S. sanctions, expects 2021 revenue to have declined nearly 30 percent and predicted continued challenges in the New Year.

The US sanctions have hit Huawei hard and the company has warned that it will see serious challenges in 2022 amid politicisation of technology, and further deglobalisation.

The Chinese conglomerate is expecting 634 billion yuan ($99.45 billion) in revenue in 2021, a 28.88 dip from 891.4 billion yuan in 2020.

Huawei’s rotating chairman Guo Ping, in a New Year letter to employees, said that the company’s carrier business had stayed stable and its enterprise unit saw growth.

“An unpredictable business environment, the politicisation of technology, and a growing deglobalisation movement all present serious challenges,” Guo Ping said.

“Against this backdrop, we need to stick to our strategy and respond rationally to external forces that are beyond our control,” Guo Ping said.

US President Joe Biden in November signed the law to ban Chinese tech companies like Huawei and ZTE from getting approval for network equipment licences in the country.

Last year, the US Federal Communications Commission (FCC) designated Huawei and ZTE as national security threats to communications networks — making it harder for US firms to buy equipment from them.

Guo Ping said that Huawei would push ahead with its focus on infrastructure and smart devices, and look to respond more quickly to customer needs with shorter “management chains”. This meant creating “integrated teams” and “domain-specific subsidiaries,” reports ZDNet.

Huawei in 2022 would look to streamline its business decision-making processes by giving more autonomy to local offices.

Huawei would increase its investment in HarmonyOS and EulerOS.

EulerOS is pitched as Huawei’s infrastructure platform that supports both on-premises and cloud computing services. It runs on Huawei’s version of Linux OS.

HarmonyOS currently supports more than 220 million Huawei devices and there are more than 100 million devices developed by third-party vendors that currently run on HarmonyOS, according to Huawei.