From a struggle for survival to a promising resurgence, Huawei, the Chinese tech titan caught in the crossfire of escalating tensions between Washington and Beijing, has announced a resounding return to form.
Recently, the Shenzhen-headquartered company unveiled projections of surpassing 700 billion yuan ($99 billion) in revenue for 2023, a notable surge attributed in part to its electronics division outperforming expectations. This marks a 9% uptick from the 642.3 billion yuan ($92.4 billion) recorded in 2022. However, it falls short of the approximately $123 billion figure reported by Huawei in 2019.
In a year-end address to employees, Huawei's rotating chairman, Ken Hu, expressed, "After persevering through challenging times, we have successfully navigated the storm. Now, we find ourselves well on the path to recovery."
The impressive revival of Huawei owes much to the surprise success of its Mate 60 Pro smartphone, unveiled in August. This achievement is particularly noteworthy considering the rigorous attempts by the United States to curtail China's access to international semiconductor supplies.
The sophisticated device has been readily accepted by consumers, allowing Huawei to regain market share from Apple in China, as reported by Counterpoint Research. Huawei claimed the fifth spot in China’s markets as of the end of September, with its share expanding from 10% in the first quarter to 14% in the third quarter. During the same period, Apple experienced a decline from 20% to 15%.
Ken Hu mentioned in his memo that Huawei’s device business’s results exceeded expectations, though he did not elaborate on the details.
Huawei was previously the second-largest global smartphone seller, but severe US sanctions in recent years obstructed its ability to secure crucial components for its devices, leading to its decline.
US policymakers have consistently argued that Huawei presents a national security threat, suggesting that the Chinese government could potentially use Huawei’s equipment for espionage. Huawei has persistently denied these claims and attempted to enhance its position in Washington. However, this year signifies a turnaround for Huawei as it’s begun to find its path back to success.
In March, Huawei announced that it had exited “crisis mode” and reported progress in finding substitutes for the components it could no longer access due to the US sanctions.
Huawei’s success is set to continue in the coming year if it can increase the production of handsets powered by Kirin chips, according to Counterpoint analysts in a November report. They were referring to the processors used in the Mate 60 Pro.
On Tuesday, the company introduced new smartphones in its mid-range series, Nova. These models are expected to gain popularity due to their relative affordability, analysts predict.
This positive forecast contrasts with comments made by a Huawei executive last year, saying that the company’s “fight to survive is not over yet.”
“Hard work has enabled us to survive and grow, but we still have serious challenges ahead of us,” Hu noted in his memo on Friday. He cautioned about “geopolitical and economic uncertainties,” and stressed that “technology restrictions and trade barriers continue to impact the world.”
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