Huawei may exit the smartphone market


Huawei's sales revenue

Reputable analyst Ming-Chi Kuo, who has proven himself with surprisingly accurate forecasts, has released a new report that looks at further options for the development of events around Huawei’s mobile division, which was most affected by US sanctions. Both scenarios considered by the expert cannot be called positive for Huawei, but nevertheless, a significant reduction in the company’s market share and a decrease in competitiveness are the most optimistic. The latter will inevitably lead to a decrease in the cost of smartphones.

Huawei may exit the mobile device market

According to the pessimistic scenario, the manufacturer will leave the mobile device market altogether, which will be good news for both overseas competitors such as Apple or Samsung, and other Chinese companies like Oppo, Vivo and Xiaomi. We will remind, two weeks earlier, the US Department of Commerce began to suppress possible ways to bypass the sanctions for the Chinese tech giant.

Huawei Kirin 1020

Huawei earned $35 million everyday throughout the first half of the year

According to the Securities Times, Huawei Investment Holdings Co., Ltd. recently released its first half-year financial report in the inter-bank market. In the first half of 2020 (H1 2020), Huawei achieved an operating income of 450.7 billion yuan ($65.6 billion). This is a year-on-year increase of 13.67%. Within the same period, its net profit is 43.1 billion yuan ($6.2 billion), a year-on-year increase of 23.49%. This means that Huawei made about $35 million in profit every day throughout H1 2020.

Huawei’s operating results for the first half of 2020 show that in the first half of 2020, the company achieved sales revenue of 454 billion yuan ($66 billion). This is a year-on-year increase of 13.1% and a net profit margin of 9.2%.

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Huawei’s H1 2020 report card looks great

Huawei’s consumer business has the highest revenue of 255.8 billion yuan ($36.5 billion). However, its carrier and enterprise businesses recorded 159.6 billion yuan ($22.8 billion) and 36.3 billion yuan ($5.1 billion) respectively.

Huawei’s H1 2020 business results show that the company is doing well despite the numerous ban. Recall that the U.S. did not ban Huawei and go to sleep. It is also putting pressure on its allies to also ban Huawei. The likes of Australia and New Zealand have since banned Huawei’s 5G equipment from their network. The latest country to ban Huawei from its 5G network is the U.K.

Despite all these, Huawei seems to be doing well, for now at least. In 2019, the company shipped about 240 million smartphones, a new record high. In April 2020, Huawei toppled Samsung to become the largest smartphone brand globally, a position it retained in May. Also, Huawei is currently the largest 5G smartphone vendor in the world. The company was able to achieve all these despite the ban from the U.S. and other allies.

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