During its latest earning calls, Huawei has revealed that it saw its largest ever decline in profit. The company saw its biggest annual decline in profits due to the impacts of the sanctions imposed by the US government.
The Chinese consumer electronics and telecommunications giant said that it saw a net profit of a total 35.6 billion Yuan (roughly 5.18 billion US Dollars) for the year 2022. This marked a whopping 69 percent year on year decline. The fall in profits is the biggest ever since the 54 percent annual decline that it saw back in 2011. One of the reasons for the massive decline is due to the massive rise in profits after it sold of its subsidiary, Honor, back in 2021.
This made the decline in 2022 appear quite a bit larger. Huawei also pointed at the rising prices of commodities along with China’s strict pandemic controls last year and the rise of its research and development expenditure as few of the reasons for the decline in profit. According to Huawei’s Rotating Chairman Eric Xu, “In 2022, a challenging external environment and non-market factors continued to take a toll on Huawei’s operations.”
He further added that “In the midst of this storm, we kept racing ahead, doing everything in our power to maintain business continuity and serve our customers”. But despite its largest ever profit fall, Huawei actually a saw a rise in revenue of a meager 0.9 percent to 642.3 billion yuan in 2022.
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