Chinese Huawei announces lower sales in 2021 and higher profits

BEIJING (AP) — Chinese telecoms equipment maker Huawei said Monday its sales fell but its profits rose 76% in 2021, despite U.S. sanctions.

Huawei’s chief financial officer was released by Canadian authorities last year, ending a standoff with Washington over the tech giant’s dealings with Iran. The company is caught in the middle of tensions with Washington over technology and security.

U.S. officials say Huawei, the biggest maker of networking equipment for phone carriers, poses a security risk that could enable Chinese espionage, a charge the company denies.

Huawei Technologies Ltd., China’s top global tech brand, has stepped up efforts to serve hospitals, mines and other industrial customers after its once-one of the biggest smartphone businesses were crippled by restrictions imposed by Washington on access to American components and other technology in 2019.

The company reported revenue of 636.8 billion yuan ($99.9 billion) in 2021, down 28.6% from 2020. It said its profit rose 75%, 9% to 113.7 billion yuan ($17.8 billion).

“Our overall financial resilience is strengthening,” Chief Financial Officer Meng Wanzhou told a press conference at Huawei’s headquarters in the southern city of Shenzhen. “The company is more capable of coping with uncertainty.”

Meng, daughter of the Huawei founder, was arrested in Canada in 2018, accused by the United States of lying to banks in Hong Kong about dealings with Iran. Chinese authorities arrested two Canadians in an attempt to force Canada to release her.

Meng was released in September under a deal with the US Justice Department that will dismiss the charges in exchange for her responsibility for misrepresenting Huawei’s dealings with Iran. The two Canadians were released after Meng returned to China.

In a passing reference to his arrest, Meng said, “In the few months since I returned, I tried to catch up.”

Huawei, founded in 1987, says it is owned by Chinese employees who make up half of its workforce of 195,000 people in 170 countries and regions.

Sanctions imposed by then-President Donald Trump blocked Huawei’s access to US processor chips and other components, as well as Google music, maps and other services. for smartphones. The White House tightened these restrictions in 2020 by preventing global manufacturers from using American technology to produce Huawei-designed chips.

Huawei responded with a greater focus on its Chinese home market and on electric and self-driving cars, industrial networks and other applications less vulnerable to US pressure.

The company sold its low-cost Honor smartphone brand to a government-led investment group in November 2020 in hopes of boosting sales by separating it from sanctions imposed on the parent company. Honor has received US government clearance to resume purchasing processor chips and other technology.

Huawei said its industrial and government customers had revenue of 102.4 billion yuan ($16.1 billion) in 2021. The company said it launched products for transportation, finance, energy and manufacturing and dedicated teams for coal mines, ports and “smart roads”.

The unit that serves telephone and internet operators had revenue of 281.5 billion yuan ($44.2 billion).