US ban to wipe $30 billion off revenue: Huawei
HONG KONG: China’s Huawei Technologies Co. Ltd has taken a harder-than-expected hit from a US ban, the company’s founder and chief executive Ren Zhengfei said, and slashed revenue expectations for the year.
Ren’s downbeat assessment that the ban will hit revenue by $30 billion, the first time Huawei has quantified the impact of the US action, comes as a surprise after weeks of defiant comments from company executives who maintained Huawei was technologically self-sufficient.
The US has put Huawei on an export blacklist citing national security issues, barring US suppliers from selling to the world’s largest telecommunications equipment maker and No.2 maker of smartphones, without special approval.
The firm has denied its products pose a security threat. The ban has forced companies, including Alphabet Inc.’s Google and British chip designer ARM to limit or cease their relationships with the Chinese company.
Huawei had not expected that US determination to “crack” the company would be “so strong and so pervasive”, Ren said, speaking at the company’s Shenzhen headquarters on Monday.
“We did not expect they would attack us on so many aspects,” Ren said, adding he expects a revival in business in 2021.
“We cannot get components supply, cannot participate in many international organisations, cannot work closely with many universities, cannot use anything with US components, and cannot even establish connection with networks that use such components.”
Huawei, which turned in a revenue of 721.2 billion yuan ($104 billion) last year, expects revenue of around $100 billion this year and the next, Ren said. This compares to an initial target for a growth in 2019 to between $125 billion and $130 billion depending on foreign exchange fluctuations.