Shenzhen, Gizmologia – A black cloud seems to envelop Huawei. Yes, this Chinese tech company has reported that it has experienced a sharp drop in profits.
As quoted Gizmologist from Reuters, on Saturday (13/08/2022), Huawei said its net profit in the first half of this year fell 52%. Annual revenue during this period was down 5.9% compared to the same period last year.
If the accumulated revenue recorded by Huawei during January-March this year is only 301.6 billion yuan. According to Huawei, this decline was caused by weaker demand.
However, according to Ken Hu, a representative of the company’s business unit, Huawei’s declining profits were only experienced in the mobile division. Meanwhile, the network is quite stable.
“Our device business is indeed affected, but ICT infrastructure growth is still stable,” he said.
Huawei’s profits are shrinking
Based on calculations Reuters, Huawei’s profit margin is currently down to 5%, with a net profit of 15.08 billion yuan. This figure is said to be down from revenue from the first half of 2021, which reached 31.39 billion yuan.
Meanwhile, Huawei claims that the drop in profits is due to the current economic crisis. In addition, the COVID-19 pandemic has disrupted supply chains at the expense of business devices such as mobile phones and laptops.
Although revenue from its device business fell by more than a quarter from the same period last year to 101.3 billion yuan, Huawei says its infrastructure and business divisions saw growth.
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This growth is due to the fact that they provide a greater share of investment in the latest technology and business. This stage is considered to have had an impact on the profits obtained.
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