Huawei Technologies' revenue fell 38% in the third quarter compared to the same period a year earlier. The reasons are clear: US sanctions have hampered production, and new areas of potential growth for the company are underdeveloped.
For the first three quarters, Huawei's revenue was 455.8 billion yuan ($ 71.32 billion), which is almost a third lower than in the same period last year. The overall profitability indicator reached 10.2%. According to Reuters, in the third quarter alone, the company's revenue amounted to 135.4 billion yuan ($ 21.16 billion). According to the estimates of the company's management, the financial indicators are in line with the forecasts.
The company was blacklisted by the United States in 2019 - access to critical American technologies was cut off. As a result, Huawei has virtually lost the ability to purchase components for equipment from third-party suppliers, as well as develop its own. The sanctions hit the company's smartphone production hard: according to September estimates, the division's revenues will decrease by $ 30-40 billion in the current year. with her consumer business.
According to Counterpoint Research, for the reporting quarter, the company took only 8% of the Chinese smartphone market , compared with 30% a year earlier - then it was the market leader. On the other hand, Honor, the independent sub-brand of Huawei last November , sold 96% more smartphones in the same Q3 than a year earlier and captured 15% of the Chinese market. Huawei is now striving to create new revenue streams beyond smartphones and telecommunications equipment: the company is developing cloud services and smart transport technologies. And the management understands that new directions will begin to generate income only after some time.
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