Huawei records 76% growth in profit for 2021

by S BIRRUNTHA / pic by TMR FILE

HUAWEI Technologies Co’s net profit surged 75.9% year-on-year (YoY) to 113.7 billion yuan (RM75.04 billion) for 2021 on the back of asset sales. 

Despite recording the biggest-ever annual gain, the smartphone and telecommunication giant’s revenue fell 29% to 636.8 billion yuan for the year. 

Nevertheless, the company revealed that it maintained solid operations throughout the past year, according to its 2021 Annual Report released yesterday. 

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Huawei CFO Meng Wanzhou said despite a revenue decline in 2021, Huawei’s ability to make a profit and generate cashflow is increasing and the company is now more capable of dealing with uncertainty. 

“Thanks to the enhanced profitability of its major businesses, the company’s cashflow from operating activities dramatically increased in 2021, amounting to 59.7 billion yuan.

“Its liability ratio also dropped to 57.8%, and its overall financial structure has become more resilient and flexible,” she said while speaking at a live-streamed event from the company’s Shenzhen headquarters. 

According to Huawei, the company’s carrier business generated 281.5 billion yuan in revenue last year and helped carriers around the world deploy leading 5G networks. 

It said 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. 

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By working with carriers and partners, Huawei has also 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. 

Meanwhile, Huawei’s enterprise business also grew rapidly, generating 102.4 billion yuan in revenue in 2021, thanks to continuing digital transformation trends. 

In the past year, Huawei said it has 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. 

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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 Artificial Intelligence Life strategy for consumers around the world. 

The company noted that this business generated 243.4 billion yuan in revenue in 2021 and continued to see steady sales growth in smart wearables, smart screens, true wireless stereo earbuds and Huawei Mobile Services. 

In particular, Huawei said the smart wearable and smart screen segments both saw an increase of 30% YoY growth. 

In total, the company said 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. 

Commenting on the performance, Huawei rotating chairman Guo Ping said overall, Huawei’s performance was in line with the forecast. 

He added the company’s carrier business remained stable, its enterprise business experienced steady growth, and its consumer business quickly expanded into new domains. 

“In addition, we embarked on a fast track of ecosystem development,” he stated during a press conference session yesterday. 

Moving forward, Guo said Huawei will advance its journey of digitalisation, 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,” he noted.