Huawei reports solid operations despite pandemic

Chinese multinational technology company Huawei has maintained solid operations over the past year despite difficulties caused by the covid19 pandemic.

At a virtual press conference on March 29, Huawei released its annual report for 2021.

Its total revenue in 2021 reached US$99.9 billion, ending the year in a solid financial position. Overall, its performance was in line with forecasts.

In 2021, Huawei generated a net profit of US$17.8 billion with a net margin of 17.9 per cent.

Cash flow from operating activities grew by 69.4 per cent. Huawei's liability ratio dropped from 62.3 per cent in 2020 to 57.8 per cent in 2021, further improving its capital structure.

By streamlining management and making full use of digital technology, Huawei made ongoing improvements to operating efficiency to generate more revenue and increase its
"fertile soil" solutions.

On it's website Huawei said it has "invested heavily in a cooperative ecosystem to develop the soft, ‘fertile soil’ needed to construct an open digital ecosystem. In doing so, Huawei aims to expand the industry market space and to form a community of common interests for a mutually beneficial coexistence."

Over the past year, the competitiveness of Huawei's products also received wide recognition from the industry. It ranked ninth on Brand Finance's list of the World's Top 10 Most Valuable Brands in 2022.

In 2021, Huawei increased research and development (R&D) investment to US$22.4 billion, representing 22.4 per cent of total revenue.

It ranked second in the 2021 European Union Industrial R&D Investment Scoreboard (Google, HW, Microsoft, Samsung, Apple and Facebook).

Guo Ping, Huawei's rotating chairman, said at the virtual press conference: "Overall, our performance was in line with forecast. Our carrier business remained stable, our enterprise business experienced steady growth, and our consumer business quickly expanded into new domains. In addition, we embarked on a fast track of ecosystem development."

Meng Wanzhou, Huawei's CFO, also spoke at the conference.

"Despite a revenue decline in 2021, our ability to make a profit and generate cash flows is increasing, and we are more capable of dealing with uncertainty," she said.

Thanks to the enhanced profitability of its major businesses, Huawei's cash flow from operating activities increased dramatically in 2021.

Its liability ratio also dropped to 57.8 per cent, and its overall financial structure has become more resilient and flexible.

In 2021, Huawei's carrier business helped carriers around the world deploy leading 5G networks.

Third-party test results have found 5G networks built by Huawei for customers in 13 countries, including Switzerland, Germany, Finland, the Netherlands, South Korea and Saudi Arabia, provide the best-user experience.

By working with carriers and partners, Huawei has signed more than 3,000 commercial contracts for industrial 5G applications. These kinds of 5G applications are currently seeing large-scale commercial use in sectors like manufacturing, mines, iron and steel plants, ports, and hospitals.

In the past year, Huawei launched 11 scenario-based solutions for key sectors such as government, transportation, finance, energy, and manufacturing.

Over 700 cities and 267 Fortune Global 500 companies have chosen Huawei as their digital transformation partner and Huawei now works with more than 6,000 service and operation partners around the world.

Guo said: "Moving forward, Huawei will advance its journey of digitalisation, intelligent transformation, and low carbon. Relying on talent, scientific research, and an innovative spirit, we will continuously increase investment to reshape our paradigms for fundamental theories, architecture, and software, and build our long-term competitiveness."

Karl Song, vice president of corporate communications, said the pandemic changed the entire business worldwide and the restructuring of the economy.

“The pandemic has been a generating force for digitisation, it is a novelty to study through machines and this merits a better functioning of the networks. The pandemic showed that there were new applications to reduce infections; we use digital money instead of cash to make payments; or the use of robots to transport medical equipment and food. This pandemic has been an accelerator to turn this into a digital age,” he said.