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Huawei Triumphs Amid Global Tech Tensions with Robust Revenue Jump

Published December 30, 2023
7 months ago

Huawei Technologies Co. has staged an impressive resurgence, as revealed by the surge in its 2023 revenue. The tech titan, often at the center of geopolitical tech scuffles, saw its sales leap to over 700 billion yuan (R1.832 trillion), marking the company's most significant growth spurt in recent years. This success is underpinned by the revitalization of its smartphone segment and vigorous sales in the 5G sector. Quarterly, the revenue rose sharply by 27% to around 243.4 billion yuan, making a stark contrast to the modest gains seen in the previous quarter.

The key to Huawei's renewed dominance has been its launch of the Mate 60 Pro smartphone, which features the cutting-edge, made-in-China 7-nanometer Kirin processor. This technological marvel stands as a defiant answer to the United States' stringent trade restrictions aimed at crippling China's tech advancement. The impact of the Kirin chip's success fuelled discussions in Washington, D.C., about the effectiveness of US trade policies and whether further actions are necessary to counter China's burgeoning tech capabilities.

Post-2019, many predicted Huawei's decline in the smartphone arena due to the US-imposed barriers that cut it off from vital global suppliers. Contrary to those forecasts, Huawei has pivoted significantly. It has embraced and greatly benefited from domestic support, securing profitable deals in 5G networks and cloud services, provided by state-run telecom operators, as well as other transactions involving its less successful businesses.

Not only has the Mate 60 Pro, which introduced the revolutionary 7nm Kirin chip in August, made a dent in Apple's market share, but Huawei has also become a formidable force in the semiconductor industry – the very sector that the Biden administration has been eager to suppress.

In its emergence as a semiconductor powerhouse, Huawei has embarked on establishing a sophisticated network of chip plants. These efforts are underpinned by an estimated $30 billion in funding sourced from both the Chinese government and its base in Shenzhen. This development comes from the company long-known for its networking and smartphone prowess.

Yet, looking ahead into 2024, Huawei anticipates a challenging environment fraught with ongoing US-driven containment strategies against China and the pressing need to maintain their technological edge — a task complicated by the increasingly scarce supply of essential chipmaking components.

Despite these challenges, US Commerce Secretary Gina Raimondo has declared the intention to take "the strongest possible" measures to protect US national security in response to Huawei's breakthroughs. Meanwhile, Huawei is doubling down on its future by planning to ramp up investments in emerging arenas like artificial intelligence, as signaled by the company's rotating chairman, Ken Hu.

Huawei's journey has not only been about profit margins but also serves as a vivid emblem of China's determination to overcome international pressure and to continue staking its claim in the global high-tech marketplace.

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