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Huawei
Tech

Huawei reports meagre revenue growth in first quarter as coronavirus, US sanctions take a toll

  • The company said its net profit margin in the first quarter was 7.3 per cent, lower than the 8 per cent in the same period last year
  • IDC expects growth to resume in global smartphone shipments in 2021, driven by accelerated 5G efforts

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A corporate logo sits on a Huawei NetEngine 8000 intelligent metro router on display during a 5G event in London on Feb. 20, 2020. Photo: Bloomberg
Celia Chen
Huawei Technologies said its revenue in the first quarter increased 1.4 per cent year on year as the global coronavirus pandemic and ongoing sanctions from the US continue to take a toll on its global business.
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The world's largest telecommunications equipment vendor generated revenue of 182.2 billion yuan (US$25.7 billion) in the first quarter of 2020, up from 179.7 billion yuan in the same period last year. No revenue figures for the company’s different business segments were released.

The company said its net profit margin in the first quarter of the year was 7.3 per cent, lower than the 8 per cent in the same period last year.

The sliding net profit margin reflects one of the most challenging times in the company’s history.

A ban on using US technology, issued by Washington last May, includes the use of Google mobile services. The move had already curtailed Huawei’s global smartphone operations even before the coronavirus crisis gripped China in January and spread around the world.

“I think Huawei is doing relatively OK, especially in China in the first quarter,” said Nicole Peng, vice-president of mobility research at Canalys. “But in terms of overseas markets, it is tricky because there are other impacts beyond the pandemic for Huawei, such as the lack of GMS [Google Mobile Service] support [due to the US ban]. Overall, there will be a lot of challenges for Huawei this year.”

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