Huawei says net profits up 75.9per cent to $17.8b in 2021

TDT | Manama

The Daily Tribune – www.newsofbahrain.com

Staff Reporter

Huawei released its 2021 Annual Report yesterday, revealing that the company had maintained solid operations throughout the past year. As per the report, Huawei achieved USD 99.9 billion in revenue in 2021, and USD 17.8 billion in net profits, an increase of 75.9% year-on-year.

The company’s R and D expenditure reached about USD 22.38 billion in 2021, representing 22.4% of its total revenue, and bringing its total R and D expenditure over the past 10 years to over USD 132.5 b. Moving forward, the company also plans to continuously increase investment in R and D. Guo Ping, Huawei’s Rotating Chairman, stated at the press conference, “Overall, our performance was in line with the forecast.

Our carrier business remained stable, our enterprise business experienced steady growth, and our consumer business quickly expanded into new domains. In addition, we embarked on a fast track of ecosystem development.” Meng Wanzhou, Huawei’s CFO, also spoke at the event, “Despite a revenue decline in 2021, our ability to make a profit and generate cash flows is increasing, and we are more capable of dealing with uncertainty.”

Thanks to the enhanced profitability of its major businesses, the company’s cash flow from operating activities dramatically increased in 2021, amounting to USD 9.3 bn. Its liability ratio also dropped to 57.8pc, and its overall financial structure has become more resilient and flexible. In 2021, Huawei’s carrier business generated USD44.1 bn in revenue and helped carriers around the world deploy leading 5G networks.

Third-party test results have found that 5G networks built by Huawei for customers in 13 countries, including Switzerland, Germany, Finland, the Netherlands, South Korea, and Saudi Arabia, provide the best user experience. By working with carriers and partners, Huawei has signed more than 3,000 commercial contracts for industrial 5G applications.

These kinds of 5G applications are currently seeing large-scale commercial use in sectors like manufacturing, mines, iron and steel plants, ports, and hospitals. Thanks to continuing digital transformation trends, Huawei’s enterprise business also grew rapidly, generating USD 16.06 bn in revenue during 2021. In the past year, Huawei launched 11 scenario-based solutions for key sectors such as government, transportation, finance, energy, and manufacturing.

The company also established multiple dedicated teams, including a Coal Mine Team, a Smart Road Team, and a Customs and Port Team, to combine resources in a way that more efficiently serves the needs of its customers. Over 700 cities and 267 Fortune Global 500 companies have chosen Huawei as their digital transformation partner and Huawei now works with more than 6,000 service and operation partners around the world.

Huawei’s consumer business zeroed in on consumer wants and needs, further building out the global ecosystem for a smart, all-connected era, as part of the company’s Seamless AI Life strategy for consumers around the world. This business generated USD 38.17 billion in revenue in 2021 and continued to see steady sales growth in smart wearables, smart screens, true wireless stereo (TWS) earbuds, and Huawei Mobile Services (HMS).

In particular, the smart wearable and smart screen segments both saw 30pc plus year-on-year growth. In total, HarmonyOS was used in over 220 million Huawei devices as of 2021, becoming the world’s fastest growing mobile device operating system. During the past year, Huawei also focused on building out its openEuler, MindSpore, and HarmonyOS ecosystems based on the principles of open collaboration and shared growth.

Over eight million developers are currently using Huawei’s open platforms, open-source software, and development tools to explore new business scenarios and business models. Guo stressed, “Moving forward, Huawei will advance its journey of digitalization, intelligent transformation, and low carbon.

Relying on talent, scientific research, and an innovative spirit, we will continuously increase investment to reshape our paradigms for fundamental theories, architecture, and software, and build our long-term competitiveness.” Speaking to The Daily Tribune, Shunli Wang, Vice-President of Huawei Middle East, said the company has laid a foundation to overcome the chip supply challenge.

“It was really a tough challenge as the global chip shortage was a highly complex issue, worsened by the US sanctions.  “Our investments in Research and Development have mainly focused on development of chips.

We will be developing many new products in the coming days and will definitely have policies in place to overcome this chip crisis.”