Despite Donald Trump’s Crackdown On Huawei, Company Reports 23 Percent Revenue Increase
Despite a trade war between the United States and China and a near ban placed on the company by President Donald Trump, Chinese mobile phone manufacturer Huawei reported $32.2 billion in revenue for the second quarter of this year, which is up 23 percent over last year, per The Verge.
The revenue increase comes as other companies, like Apple, fall in the region. According to CNBC, shipments from Apple fell some 14 percent in the second quarter. Other Chinese companies like Oppo and Xiaomi also reported double-digit losses.
In May of this year, President Trump placed Huawei on a list of companies called an “entity list,” which requires U.S. companies to apply for a license from the Bureau of Industry Security to be able to sell or purchase from the companies, per CNBC.
At the time, the president declared a national emergency in an executive order and said Huawei and its affiliated companies posed security threats amid an ongoing trade war between China and the United States. In the executive order, Trump authorized Commerce Secretary Wilbur Ross to block transactions involving communications technology that he viewed as posing a potential risk to national security.
The executive order against the company followed months of scrutiny against the company from the U.S. government. At the beginning of the year, the Justice Department brought charges against arms of the company and alleged it stole trade secrets from T-Mobile. At that time, the company was prohibited from working as a contractor for the U.S. government, per The Verge, as part of the 2019 Defense Authorization Act.
Huawei smartphone sales up 24 percent despite US crackdown https://t.co/ihE6X0j4dQ pic.twitter.com/m1gQRQ0SwH
— The Verge (@verge) July 30, 2019
As The Verge noted, due to Huawei’s private ownership structure and organization, the company is not required to release detailed earnings reports expected from public companies. Still, the late-July release is more detailed than any earnings report previously issued by the Chinese company, per The Verge.
“Revenue grew fast up through May,” Huawei chairman Hua Liang said in a statement Tuesday. “Given the foundation we laid in the first half of the year, we continue to see growth even after we were added to the entity list. That’s not to say we don’t have difficulties ahead. We do, and they may affect the pace of our growth in the short term.”
According to CNBC, Huawei now accounts for 38 percent of all smartphone shipments in China. The data, which is from a report from Singapore-based technology market analyst firm Canalys, noted that the company has shifted its focus back toward China as it faces the Trump administration’s policies in the U.S. Per The Verge, China accounted for 64 percent of all of Huawei’s shipments during the second quarter of this year.
