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China's Huawei seeks out growth areas as risks mount

China's Huawei braces for tough year with external risks adding to sanction challenges
China's Huawei braces for tough year with external risks adding to sanction challenges Copyright Thomson Reuters 2022
Copyright Thomson Reuters 2022
By Reuters
Published on Updated
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SHENZHEN, China -Huawei Technologies has identified helping businesses to use 5G technology, cloud computing and to improve their energy efficiency as ways to bolster the company in the face of mounting challenges, its rotating chairman said on Tuesday.

In 2019 the U.S. Trump Administration put Huawei on an export blacklist, putting its once mighty handset business under immense pressure. The United States says Huawei is a security risk, which the company has denied.

Rotating chairman Ken Hu said on Tuesday the company faced an even more daunting year than in 2021 as geopolitics, the COVID-19 pandemic, rising commodity prices and fluctuating exchange rates add to the sanctioned-hit company's difficulties.

Addressing Huawei's annual analyst summit on Tuesday, Hu echoed comments the company made a year ago that developing new and more resilient business areas was essential to survival.

"We know in our hearts, Huawei still faces a lot of challenges and we need to redouble our efforts," he said, citing 5G, cloud computing and energy efficiency as growth areas for Huawei.

"Huawei has been unfairly suppressed and sanctioned and we can't source some advanced components," he added.

Huawei's revenue fell 29% last year to 636.8 billion yuan ($97.36 billion), while net profit rose 76% to 113.7 billion yuan, buoyed by the sale of budget smartphone unit Honor.

The company is under scrutiny over whether it plans to stay in Russia, as many Western firms have pulled out following Moscow's invasion of Ukraine that began on Feb. 24.

It has also faced internal pressure, as two of its British board members resigned in March after it did not condemn the war. The company did not take any questions on Russia on Tuesday.

($1 = 6.5409 Chinese yuan renminbi)

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