Huawei revenue growth wilts under 'intense pressure'

Ruben Fields
October 23, 2020

This week Sweden became the latest country to ban use of the company's gear in its 5G networks.

A day later it said revenues over the first nine-months of the year hit just over 100 billion dollars.

Sales climbed by 3.7% to 217.3 billion yuan ($32.5 billion) from a year earlier, versus 23% for the second quarter, according to Bloomberg calculations based on January-September figures reported by Huawei.

For the July-September quarter, revenue grew just 3.7% on the year to 217.3 billion yuan as the latest US export control rule took full effect in mid-September, cutting off the company from its most important global chip and component suppliers.

Net profit margin for the nine months was 8.0%, versus 8.7% over the same period a year earlier, Huawei said.

Earlier this year, however, Consumer Business Group Chief Executive Richard Yu said US restrictions meant Huawei would soon stop making high-end Kirin chips.

Meanwhile, the company stockpiled critical radio chips to ensure it can supply China's carriers in their rollout of 5G technology past 2021, people familiar have said.

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That being said, the Mate 30E Pro is the same as the Mate 30 Pro in every way, except it comes with the Kirin 990E processor. Already, consumers in China have rushed to buy Huawei smartphones on concerns over the availability of newer models.

What's the context: Under updated sanctions imposed by the USA government, Huawei's major chipmaking partners stopped supplies to the company in mid-September.

Huawei Mate 40 Pro will go on sale on 13 November in the UK.

The Mate 40 Pro and the Mate 40 Pro +. The company said those results "basically met expectations", but it represents a huge drop from its performance during the same period a year ago, when Huawei reported 24.4% growth with a profit margin of 8.7%. In addition to these three models, Huawei also unveiled Porsche Design Huawei Mate 40 RS.

Overseas sales have been sluggish though, partly due to restrictions on Huawei's use of Google apps.

Reflecting its manufacturing difficulties, Reuters reported last week that Huawei was talking to Digital China Group Co Ltd and others to sell parts of its Honor budget handset business in a deal that could fetch up to 25 billion yuan. Late Thursday, the Chinese firm launched its latest flagship handset, the Mate 40 Pro.

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