Huawei Reports Strong Financials

By David Kirton

SHENZHEN, China (Reuters) – Chinese tech giant Huawei reported significant increases in its first-half revenue and net profit on Thursday, attributed to robust smartphone sales and a thriving smart car components sector despite ongoing U.S. sanctions.

Net profit for January to June rose 18% to 54.9 billion yuan (approximately $7.7 billion), alongside a 34.3% increase in revenue to 417.5 billion yuan. This marks Huawei’s highest revenue for the first half since the same period in 2020.

While Huawei did not provide a detailed breakdown of earnings by unit, a spokesperson indicated that its key consumer business—which includes smartphones and PCs—performed well, along with its smart car components unit.

According to research firm Canalys, Huawei shipped 22.2 million smartphones in mainland China during the first half of the year, reflecting a 55% increase compared to the previous year.

Huawei made a comeback in the 5G premium smartphone market with its Mate 60 series last year and the high-end P series this year, although most sales remain centered in China. These product launches have been celebrated domestically, symbolizing a success in overcoming U.S. sanctions that have restricted the company’s access to advanced U.S. chips and technology since 2019.

The U.S. government considers Huawei a national security threat—a claim the company refutes. Sanctions have since expanded to include export bans on advanced U.S. chips for all Chinese firms, aimed at hindering technological advancements that could benefit China’s military.

Over the past four years, Huawei has also experienced remarkable growth in its Intelligent Automotive Solutions unit, aiming to become a leading supplier of software and components for smart electric vehicles, securing deals with various automakers.

The information and communications technology, cloud, and digital power divisions of Huawei also showed steady performance. According to the spokesperson, the profits for the first half were not inflated by the sale of businesses or assets, in contrast to the same period last year.

($1 = 7.1165 Chinese yuan)