Business & Economy

Huawei posts 5.6 percent rise in profits in 2019 despite trade war impact

Beijing, Mar 31 (efe-epa).- Chinese tech giant Huawei reported Tuesday a 5.6 percent increase in net profits, amounting to a total of 62.7 billion yuan ($8.8 billion) in 2019, despite suffering the impact of a trade war between China and the United States.

The US had included the company in a trade blacklist in May, considering it a national security risk due to alleged links with the Chinese intelligence, although subsequently four moratoriums have been issued allowing Huawei to maintain ties with American firms.

In an online press conference, one of the three rotational chairmen of the company, Eric Xu, admitted that 2019 had been a “very challenging” year for Huawei, but insisted that business was “stable” and the results had met expectations.

The unlisted company said that over the last year it sold 240 million smartphones – up from 206 million in 2018 – and that total sales had jumped 19.1 percent year-on-year to 858.8 billion yuan.

As per the company records, its net profit had grown 25.1 percent in 2018.

Consumer services continued to be the biggest revenue source for the company in 2019, representing 54.4 percent of total sales. Profits from the segment grew 34 percent to 467.3 billion yuan during the year.

Meanwhile revenue from services to telecom operators increased 3.8 percent, and corporate services revenue registered a rise of 8.6 percent.

In 2019, Huawei increased its investment on research and development by nearly 25 percent to 131.7 billion yuan, accounting for 15.3 percent of total revenue for the year.

Over the last decade, the tech firm has spent more than 600 billion yuan on research and development, according to the company.

In February, the US authorities charged Huawei and two of its subsidiaries with federal racketeering and conspiracy to steal trade secrets from American companies.

Washington even went on to urge its allies in Europe and other parts of the world to keep Huawei away from the developing 5G networks in their countries, calling it a “high-risk vendor.”

However, in January the United Kingdom went ahead in granting the company limited access to 5G networks, and the Chinese firm remains a top contender in the sector.

On Tuesday, the tech firm reported that cash flow from operating activities had jumped 22.4 percent year-on-year in 2019 to 91.4 billion yuan. EFE-EPA


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