Despite the continued escalation of the US crackdown, Huawei still achieved growth in revenue and net profit in the first half of the year.
In the first half of 2020, Huawei achieved an operating income of RMB 450.7 billion yuan, up 13.67 percent year-on-year, according to Huawei Investment Holdings Ltd.'s first-half financial results released in the Chinese interbank market on August 28.
In the first half of this year, Huawei's net profit was RMB 43.1 billion, up 23.49 percent year-on-year.
According to Huawei's previous unaudited financial information, in the first half of 2019, Huawei achieved sales revenue of RMB 401.3 billion, up 23.2 percent year-on-year, with a net profit margin of 8.7 percent. Huawei did not announce its net profit at that time.
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However, this latest disclosure of financial data shows that in the first half of 2019, Huawei's operating income was RMB 396.538 billion, an increase of 22.86% year-on-year. The net profit at that time was RMB 34.9 billion, down 10.12 percent year-on-year.
Huawei was also affected by Covide-9. In the first quarter of this year, Huawei's operating income was RMB 180.6 billion, up 2% year-on-year. Its quarterly net profit was RMB 13.347 billion, down 7.57% year-on-year.
Stepping into the second quarter, however, Huawei's profitability improved, generating operating income of RMB 270.1 billion, up 49.55% from the first quarter. Net profit was RMB 29.753 billion, an increase of 122.91% from the first quarter.
Despite the US crackdown, Huawei's consumer business, which contributes half of its revenue, grew strongly.
According to the release, Huawei's consumer business revenue in the first half of the year was 255.8 billion yuan, up 15.85 percent from 220.8 billion yuan in the same period last year.
Huawei's carrier business revenue was RMB 159.6 billion in the first half, up 8.94%% year-on-year. Its enterprise business revenue was RMB 36.3 billion, up 14.87% year-on-year.
In 2019, Huawei's consumer business revenue was RMB 463.7 billion, up 34% year-on-year, accounting for 54% of total revenue. In the first half of this year, the contribution of Huawei's consumer business to revenue increased to 56%.
In the second quarter, Huawei's phone sales essentially tied Samsung, with the gap between the two narrowing to 634,400 units, according to market research firm Gartner.
Huawei, Samsung almost tied for No 1 smartphone maker in Q2, Gartner data shows
Global smartphone sales fell 20.4 percent to 295 million units in the second quarter of 2020, the data showed. Huawei's handset sales were 54,125,500 units with a market share of 18.4 percent, down 6.8 percent year-over-year, and up 27.4 percent from the previous quarter.
Samsung's handset sales fell 27.1 percent year-over-year, the largest decline on record. Samsung remained No. 1 with 54,759,400 handset sales and 18.6 percent market share in the second quarter.
On May 15 last year, the United States will Huawei on the "entity list", which means that US companies need a license from the US government to sell technology products to Huawei.
On May 15 this year, the US upgraded its restrictions on Huawei, which will strictly restrict Huawei from using US technology and software to design and manufacture semiconductor chips. This means that under the new rules, TSMC and other companies will not be able to produce chips for Huawei's foundry.
In response, Huawei released a statement saying, it is conducting a full assessment of the incident. It said it expect its business will inevitably be affected and will do its best to find a solution.
On August 17, the United States further tightened restrictions on Huawei's access to US technology to limit Huawei's access to commercial chips, effective immediately, and Huawei's 38 subsidiaries in 21 countries / regions around the world were put on the "entity list".
