Huawei's third-quarter revenue jumps 27% as smartphone sales surge

Wed, 2019-10-16 21:55

SHENZHEN, SHANGHAI: Huawei Technologies Co. Ltd’s
third-quarter revenue jumped 27%, driven by a surge in shipments of
smartphones launched before a trade blacklisting by the United
States expected to hammer its business.
Huawei, the world’s biggest maker of telecom network equipment
and the No. 2 manufacturer of smartphones, was all but banned by
the United States in May from doing business with American
companies, significantly disrupting its ability to source key
parts.
The company has been granted a reprieve until November, meaning it
will lose access to some technology next month. Huawei has so far
mainly sold smartphones that were launched before the ban.
Its newest Mate 30 smartphone — which lacks access to a licensed
version of Google’s Android operating system — started sales
last month.
Huawei in August said the curbs would hurt less than initially
feared, but could still push its smartphone unit’s revenue lower
by about $10 billion this year.
The tech giant did not break down third-quarter figures but said on
Wednesday revenue for the first three quarters of the year grew
24.4% to 610.8 billion yuan.
Revenue in the quarter ended Sept. 30 rose to 165.29 billion yuan
($23.28 billion) according to Reuters calculations based on
previous statements from Huawei.
“Huawei’s overseas shipments bounced back quickly in the third
quarter although they are yet to return to pre-US ban levels,”
said Nicole Peng, vice president for mobility at consultancy
Canalys.
“The Q3 result is truly impressive given the tremendous pressure
the company is facing. But it is worth noting that strong shipments
were driven by devices launched pre-US ban, and the long-term
outlook is still dim,” she added.
The company said it has shipped 185 million smartphones so far this
year. Based on the company’s previous statements and estimates
from market research firm Strategy Analytics, that indicates a 29%
surge in third-quarter smartphone shipments.
Still, growth in the third quarter slowed from the 39% increase the
company reported in the first quarter. Huawei did not break out
figures for the second quarter either, but has said revenue rose
23.2% in the first half of the year.
“Our continued strong performance in Q3 shows our customers’
trust in Huawei, our technology and services, despite the actions
and unfounded allegations against us by some national
governments,” Huawei spokesman Joe Kelly told Reuters.
The US government alleges Huawei is a national security risk as its
equipment could be used by Beijing to spy. Huawei has repeatedly
denied its products pose a security threat.
The company, which is now trying to reduce its reliance on foreign
technology, said last month that it has started making 5G base
stations without US components.
It is also developing its own mobile operating system as the curbs
cut its access to Google’s Android operating system, though
analysts are skeptical that Huawei’s Harmony system is yet a
viable alternative.
Still, promotions and patriotic purchases have driven Huawei’s
smartphone sales in China — surging by a nearly a third compared
to a record high in the June quarter — helping it more than
offset a shipments slump in the global market.

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Source: FS – All-News-Economy
Huawei's third-quarter revenue jumps 27% as smartphone sales surge