Huawei net profit jumps as it makes headway beyond China

Business Friday 01/April/2016 18:36 PM
By: Times News Service
Huawei net profit jumps as it makes headway beyond China

Muscat: Huawei Technologies’ net profit surged 33 per cent in 2015 at $5.7 billion after the China’s largest maker of telecommunications gear grabbed market share with premium smartphones and mobile carriers expanded their high-speed networks globally.
The company said that its Carrier, Enterprise, and Consumer Business Groups (BGs) all achieved strong year-on-year growth. The three BGs generated 60.8 billion in annual revenue worldwide, an increase of 37 per cent year-on-year.
Huawei, which debuted its first Android device in 2009 to complement its main networking business, is now pushing into markets from the United States to Europe to help offset a decelerating home market. That helped its consumer-products arm expand revenue by 73 per cent, its fastest-growing division.
Guo Ping, Huawei's deputy chairman and rotating chief executive officer, said, "In part, Huawei owes its long-term growth to the sheer size of the ICT market, which is the driving force of digital economies around the world. However, our growth is also a direct result of strategic focus and heavy investment in our core businesses.”
“Over the next three to five years, we will concentrate on enhancing connectivity, enabling the development of vertical industries, and redefining network capabilities. With an open and collaborative approach, and a commitment to shared success, we will work closely with our customers and partners to maximize industry development opportunities. Together, we will build a Better Connected World,” he added.
In 2015, Huawei's three business segments experienced significant growth: The Carrier BG generated $35.8 billion in annual revenue, up 21 per cent year-on-year. Widespread rollout of 4G networks accounted for a large portion of this growth.
The Enterprise BG generated $4.3 billion in annual revenue, an increase of 44 per cent year-on-yaer. In particular, Huawei's enterprise business experienced rapid growth in the public safety, finance, transportation, and energy sectors.
A major highlight of the company's performance in 2015, Huawei's Consumer BG reported $19.9 billion in annual revenue, up 73 per cent year-on-year. This increase was a direct result of increased demand for high-quality products that deliver a premium user experience, as well as Huawei's growing influence as a consumer brand.
Over the past 20-plus years, Huawei has remained focused on ICT infrastructure, steadily investing in R&D. In 2015 alone, Huawei invested 15% of its annual revenue – CNY 59.6 billion (US$9.2 billion) – in research and development. Huawei's total R&D investment over the past decade exceeds CNY 240 billion (approximately US$37 billion).
Sabrina Meng, Huawei's chief financial officer, noted: "We wrapped up 2015 in a robust financial position, with stable cash flow from operating activities, increased cash availability, and effective risk control. In 2016, we will continue to focus on our pipe strategy, staying customer-centric in all we do. We will press ahead with management transformation projects to better prepare ourselves for the future, and continue boosting the efficiency of our operations to ensure sustainable growth."