According to a company filing released on Tuesday, tech giant Huawei’s first-quarter profits increased by more than five times year over year. The US-sanctioned company is currently on the rise and has begun to eat into Apple’s sales in China.
For a considerable amount of time, Huawei has been embroiled in a fierce technological competition between Beijing and Washington. Washington has warned that Huawei’s technology may be used for Chinese espionage activities; Huawei has refuted these claims.
Huawei’s smartphone production was significantly hindered at the time by sanctions imposed by Washington in 2019, which limited the company’s access to components made in the United States.
Since then, in an attempt to revive declining sales, the Shenzhen-based company has responded by expanding into other industries like 5G, artificial intelligence, and smart-driving technologies.
In the first quarter of this year, net profit increased by 564 percent to $2.7 billion, as reported in a results filing by Huawei’s holding company on its official website, which was verified by a company representative.
According to the report, revenue increased by 36.7 percent on an annual basis over that time to $24.7 billion.
Profits were not broken down by industry.
Due to its private status and lack of listing, Huawei is exempt from the same reporting requirements that apply to other large corporations.
The company questioned the efficacy of US prohibitions last summer when it announced the Mate 60 Pro, a high-performance smartphone with a CPU that experts say would be impossible to create without foreign technologies.
The Mate 60 was announced in August 2023, seemingly as a jab at Washington, coinciding with a visit to China by US Department of Commerce chief Gina Raimondo, who oversaw the penalties.
Apple, a rival of Huawei, suffered a 19% decline in iPhone sales in China during the first quarter, according to a report by Bloomberg that referenced market research firm Counterpoint.
The company’s most recent earnings report was released a month after Huawei claimed that its profits in 2023—a year in which it kept up its attempts to diversify—more than doubled.
The spokesman stated in a statement, “We are confident that we can meet our annual business targets and achieve sustainable growth.”
Beijing and Washington, the two biggest economies in the world, are still at odds over everything from trade to Taiwan, which China claims as its own. Tensions between them are still high.
With the argument that China would use Huawei’s 5G technology to monitor communications and data traffic in other nations, the US has pushed allies to follow suit and prohibit the technology from being used on domestic telecommunications networks.
Shayne Heffernan
