Tuesday, Oct 26th 2021 5:30 AM

Market Digest Nigeria


Huawei assume $30b revenue shortfall, growth decline


The Chief Executive Officer, Huawei, Ren Zhengfei, has admitted that the current challenge facing the company will cost the firm at least $30 billion in revenues for 2019 and 2020.

Speaking during one of the interview sessions, broadcast by Chinese state-owned, CGTN, with the theme, ‘A coffee with Ren’, organised to demonstrate once more how open Huawei is. It was also to demonstrate how willing it is to engage with the global community, Zhengfei said the firm doesn’t hold the current challenges against companies, especially from the U.S, saying they’re just doing what politicians tell them. According to Telecoms.com, Zhengfei put some numbers on the bottom line effect of all this for the first time, unprompted.

“In the next two years I think we will reduce our capacity. Our revenue will be down by around $30 billion compared to forecasts, so our sales revenue this year and next will be around $100 billion. By 2020, we may regain our growth momentum, to contribute more to human society. “In the next two years, we’re going to do a lot of the switch over of different product versions, that will take time but after that step we will be stronger… We are strong, I think that there is no way we can be beaten to death.” Zhengfei stressed that the telco wants to contribute to humanity, which seems to be a coded way of saying that being horrid to Huawei will ultimately make everyone worse off, a sentiment shared by the U.S. technologists at the interview session.

This philanthropic calling means Huawei isn’t going to cut down on research and development spend, insisted Zhengfei, although the need to diversify away from the U.S. supply chain as quickly as possible would seem to be a fairly strong incentive too. Huawei revenues grew by 20 per cent last year to $107 billion, and were forecast to repeat that growth. The Huawei CEO said they’ll now shrink this year, and be flat next year, but even that may be optimistic, as he hopes that Huawei will be largely independent of the U.S. supply chain by 2021. Huawei is trying to portray itself as a victim, while still remaining strong in spite of it, which seems reasonable considering the circumstances.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

To Top
Get the best of Market Digest Nigeria financial news
delivered to your inbox daily!
By clicking Give it a try, I hereby: Agree and Consent to the Terms of Use and the Privacy Policy
& I may receive free newsletters & promotions from this site and can choose to unsubscribe anytime.