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Translated by: MOS Finance Team – Xia
At Huawei’s recent “2021 Annual Report Presentation,” Guo Ping, Chairman-in-Office, mentioned that Huawei is now facing difficulties with “unavailability of advanced processes” under U.S. sanctions, which means it is unable to obtain advanced chips and electronic boards, according to local media reports on March 28.
According to the 2021 annual report, Huawei achieved global sales revenue of RMB 636.8 billion in 2021, down 28.6% year-on-year, and RMB 113.7 billion in net profits, an increase of 75.9% year-on-year. In response, Meng Wanzhou, Chief Financial Officer of Huawei, blamed the decline in revenue on U.S. sanctions, but had no clear explanation for the unreasonable net profit increase.
Huawei received nearly RMB 100 billion from the sale of business assets related to Glory brand in late June 2021 and negotiated the sale of its X86 server business in November. With the business being broken up and sold off multiple times, Huawei fell out of the top five in China’s cell phone sales rankings, and then failed in the 2022 telecom server tender.
In response, analysts pointed out that under further sanctions from the U.S., key businesses such as cell phones and servers collapsed, making Huawei even more difficult, which lacks R&D capabilities. The abnormal sharp rise in its net profit is a deliberate positive illusion due to the sale of the company’s assets.
Proofread/ Edited by: Xiequyuan
Posted by: Peter Chen
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