Huawei releases its 2020 annual report and financial briefing to show the impact of US sanctions on its business over the past year. The report shows that although Huawei sales in North America and Europe have fallen sharply. This shows stronger results in China have allowed the company to generate higher sales and net profits than last year.
Huawei does not report on the sales quarterly due to being a private organization. Huawei have not a specific employee ownership structure. Its annual report is usually the best picture of how it actually performed.
The company total revenue in 2020 year was 891.4 Billion yuan that is 136$ billion, increment of 3.8% from 2019. Net income rose 3.2 percent to 64.6 billion yuan (~ 9.86 billion US dollars) -Dollar ).
66% of Huawei sales generated in China last year, compared with 59% last year. Meanwhile, sales from America fell 24.5%.
Huawei noted that the carrier business in China has grown due to the fast local deployment of 5G. This relies heavily on Huawei technology. Rival Nokia know for its absence in the market.
Huawei drop sales in North America and Europe
According to the company, the deployment of 5G networks is also strong in Europe, the Middle East and Africa. In America, however, the sharp drop in sales was due to “fluctuating investment in the telecommunications market in several countries”.
Countries like Canada have chosen Samsung to roll out 5G on top of Huawei.
The Huawei CEO Ren Zhengfei told to the Washington Post and other publications agencies this week that 2020 year will be very difficult year for the company business.
The restrictions imposed by US on exports are said to have a huge impact on Huawei, especially on Huawei’s consumer business.
According to Huawei, the consumer division was even able to increase its sales by 3.3% by 2020. However, it is clear that in China in particular, the company’s smartphone sales declines, in large part due to a lack of production capacity.
Huawei relies on components stored before sanctions approve. And as Bloomberg notes, Huawei’s quarterly revenue fell each year for the first time in the last quarter of 2020.
“In the long term, we believe this will damage the reputation and competitive advantage of the American industry,” the CEO said, adding.