In a remarkable recovery, Huawei Technologies experienced its fastest growth in four years in 2023, buoyed by a revival in its consumer segment and revenue from emerging businesses such as smart car components, accelerating its recovery from US sanctions.
The company reported a robust revenue increase of 9.6% from the previous year, reaching C¥704.2 billion (US$97.5 billion). Notably, the consumer business played a significant role in this growth, with a remarkable 17.3% surge to C¥251.5 billion.
While specific details regarding the consumer segment were not disclosed, it encompasses Huawei’s handset business, which witnessed a resurgence in 2023. The launch of flagship models like the Mate60 Pro allowed the company to re-establish its presence in the mainstream 5G smartphone market, despite facing challenges from US restrictions imposed since 2019.
The restrictions imposed by the US, alleging security risks associated with Huawei, have posed significant hurdles for the company. Nonetheless, Huawei’s performance in 2023 marked the third consecutive year of growth, following a substantial revenue decline of almost one-third in 2021, primarily due to chip shortages. However, despite this growth, revenue remains below its peak in 2020, standing at C¥891.3 billion.
In contrast to previous years, Huawei opted for a more subdued approach to celebrating its achievement, forgoing the traditional press conference and launch event that had been a staple since the imposition of US restrictions.
Ken Hu, rotating chairman of Huawei, expressed satisfaction with the results, noting that they were in line with forecasts. “We’ve faced numerous challenges in recent years, but despite these obstacles, we have continued to grow,” Hu remarked in a press release.
The company’s net profit surged by an impressive 144.5% in 2023, reaching C¥87 billion, with the net profit margin more than doubling compared to the previous year, standing at 12.35%. A portion of this profit came from ongoing payments related to the sale of the Honor smartphone brand, which Huawei divested in November 2020.
While Huawei’s core ICT infrastructure business remained stable, its cloud business experienced notable growth, expanding by more than a fifth and generating revenue of C¥55.3 billion.
Another standout performer was Huawei’s smart car software and components business, which witnessed significant growth, albeit from a lower base, soaring by 128.1% year-on-year to C¥4.7 billion. In line with its strategy, Huawei announced plans to spin off the smart car unit into a separate entity, a move expected to enhance its focus and profitability.
Richard Yu, Managing Director and Chairman of Huawei’s smart car solutions, expressed optimism about the unit’s prospects, indicating that it is likely to achieve profitability from April onwards, following significant investments in the past year.
Huawei’s impressive performance in 2023 underscores its resilience and adaptability in navigating challenging market conditions, positioning the company for sustained growth and innovation in the years ahead.