Home » Huawei and the effects of the American ban: the ride has stopped

Huawei and the effects of the American ban: the ride has stopped

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In the year of the pandemic, and struggling with the US trade ban that weighs like a ballast, Huawei tries to resist. And the financial results of 2020, just made public by the Shenzen company, confirm this route. The numbers clearly indicate that the Chinese giant’s overflowing ride has calmed down. The company’s global revenue in 2020 amounted to $ 136.7 billion, up 3.8% year-over-year. In 2019, year-over-year growth was 19%.
Net income reached $ 9.9 billion, up 3.2% year on year (up from 5.6% a year ago). And then there is the quarterly revenue figure to worry. Because for the first time in the history of the Asian giant, they have shrunk, reflecting the devastating impact of US sanctions that forced China’s largest tech company to slow down sharply towards the top of the largest smartphone maker.

Only the internal market holds up

This can also be understood when judging the data of the three business units that make up the overall balance sheet. In 2020, the Enterprise Business Group’s revenue reached $ 15.4 billion, up 23% year-on-year. While the turnover of the Consumer Business Group (which is what also includes smartphones) stopped 74.1 billion dollars, up yes, but only 3.3% compared to the previous year. And according to analysts, it is thanks to the new types of products (such as smartwatches and laptops). In addition, Huawei’s numbers have been dragged into the positive mainly by its domestic market, with revenues in China increasing to 15.4% in 2020. Conversely, Europe, the Middle East and Africa have seen a contraction. by 12.2%, while revenues from Asia decreased by 8.7%. and 24.5% in the Americas.

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No glimpse from the White House

In short, 2020 seems to have been the hardest year ever recorded by the Chinese company. The trade ban imposed by the Trump administration in May 2019 has effectively stifled Huawei’s claims to become a leader in the smartphone market, when it was one step away from hooking Samsung. The impossibility of being able to continue using Google’s services have made Huawei’s smartphones decidedly unattractive for the Western market. And in all of this, the change in the White House – with the arrival of Joe Biden – did not hint at any major changes. So much so as to push Ren Zhengfei, the founder of Huawei, to seek new areas of growth: from agritech to healthcare, up to electric cars.

Precisely in relation to electric cars, Huawei is the subject of persistent speculation as to whether it wants to join other technology giants (from Apple to Baidu, up to Xiaomi) who seem to want to explore this market, in the hypothesis of having their own car following the road opened by Tesla. And although Huawei has repeatedly denied that it wants to launch a car with its own brand, it has already been collaborating with several manufacturers to test its autonomous driving technologies for some time.

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