In 2022 Huawei Posts Biggest Annual Profit Decline on Record

Huawei has also stepped into booming China’s EV industry by launching vehicles in partnership with Seres.

Chinese technology corporation Huawei posted its biggest annual decline in profit in 2022. The company said it has never experienced such a decline in yearly profit as it did last year. According to Huawei, the annual profit decline was due to the strict pandemic controls in China that affected many companies. Notably, Chinese businesses across different sectors felt the impact of the US sanctions and control measures as a result of the coronavirus pandemic.

Huawei Sees Lowest Decline in Annual Profit

According to the manufacturing company, the annual profit declined 69% YoY to $35.6 billion yuan ($5.18 billion). These figures are the lowest since 2011 when the company fell 54% year-over-year. Notably, the sale of the Honor smartphone brand added to the manufacturer’s 2021 big pup in profit. Apart from the pandemic controls and US sanctions, Huawei blamed rising commodity prices and increased expenses on research and development for the huge annual profit decline.

Speaking at the company’s annual report press conference, Huawei’s Rotating Chairman Eric Xu, noted:

“In 2022, a challenging external environment and non-market factors continued to take a toll on Huawei’s operations. In the midst of this storm, we kept racing ahead, doing everything in our power to maintain business continuity and service our customers. We also went to great lengths to grow the harvest – generating a steady stream of revenue to sustain our survival and lay the groundwork for future development.”

The company’s chief financial officer Sabrina Meng said the overall business tallied with forecasts despite the annual profit decline. The CFO stated that the liability ratio was 58.9% while the net cash balance was 176.3 billion yuan. She mentioned the balance of the total asset that reached 1 trillion yuan, claiming that Huawei’s financial position remains “solid with strong resilience and flexibility.” Revenue in 2022 added 0.91% to 642.3 billion yuan.

Emphasizing its strength even after posting its most significant annual profit decline on record, Xu said Huawei would see sustainable survival and development in 2023. He added:

“While it’s true that we have considerable pressure ahead of us, we have what it takes to come out the other end – with opportunities to grow, a resilient business portfolio, a unique competitive edge, the enduring trust of our customers and partners, and the courage to invest heavily in R&D. We are confident in our ability to rise above any challenge that comes our way, laying a solid foundation for sustainable survival and development.”

Huawei has also stepped into booming China’s EV industry by launching vehicles in partnership with Seres. The Aito M5 was built with Huawei’s HarmonyOS operating system. The technology company said its “Intelligence Automotive Solutions” pulled in 2.1 billion yuan last year.


Business News, Market News, News

Ibukun Ogundare

Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience.
Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.

Source link

Share this article: