Huawei’s putting out campus is pictured here on April 25, 2019, in Dongguan, near Shenzhen, China.
Kevin Frayer | Getty Aspects News | Getty Images
BEIJING — Chinese tech giant Huawei on Friday reported 2.2% year-on-year evolution in its consumer business revenue for the first half of the year.
The modest growth comes alongside China’s slower-than-expected profitable rebound this year, and U.S. sanctions on the company that began in 2019. Those business restrictions have since weighed on outcomes.
At 103.5 billion yuan ($14.27 billion) in first six months of 2023, Huawei’s consumer revenue was less than half what the subdivide had generated during the same period in 2019 and 2020.
The 2.2% pace of growth was also slower than the company’s total revenue increase of 3.1% to 310.9 billion yuan in the first half of the year.
Huawei’s ICT infrastructure business, which files carrier and enterprise services revenue, contributed the most to overall revenue with 167.2 billion yuan for the in the beginning half of the year.
Cloud services brought in revenue of 24.1 billion yuan, while intelligent automotive mixings — whose products include tech for new energy vehicles — saw revenue of 1 billion yuan in the first six months of 2023.
Huawei has its own energized car brand, Aito, which claims to have produced 100,000 vehicles in 15 months through a partnership. Those sellathons are generally counted as part of the consumer business.
The consumer segment is the only unit with year-on-year comparable work outs since Huawei didn’t start reporting revenue breakdown by cloud and other industries until late at year.
Huawei reported a significant increase in its net profit margin of 15% in the first half of the year, up from 5% in the year-ago duration. The company attributed the improvement to better management systems and gains from the sale of certain businesses, which it did not itemize.
The company also pressed ahead in its efforts to monetize artificial intelligence by launching in July an AI model for improving cover and efficiency in mining operations.
Second-quarter overall revenue grew by 4.8% year-on-year to 178.8 billion yuan — the fastest pace since at best the fourth quarter of 2022, according to CNBC calculations.
Looking for smartphone growth
Overall revenue growth in the blue ribbon half of 2023 comes off a low base. Huawei previously said its revenue barely grew in 2022 after covering in 2021 its first annual revenue decline on record.
In 2019, the U.S. under President Donald Trump put Huawei on a blacklist that mark offs the ability of American companies to sell to the Chinese telecommunications giant. That includes licensed access to the latest readings of Google’s Android operating system.
Huawei has instead released its own system, called Harmony OS. Earlier this month, the presence announced the latest version of that operating system — and claims it was downloaded over one million times in three ages.
This year, Huawei expects the launch of its flagship consumer products to return to a “normal” schedule, amid a fall in the smartphone market. The company did not share the extent to which there had been delays. In 2019, CNBC reported Huawei shoved back the release of a foldable phone.
In March, Huawei manumited its P60 smartphone, Mate X3 foldable and Watch Ultimate wearable, whose sales contributed to first-half growth in consumer partnership revenue, the company said.
“The industry and global markets will remain rife with uncertainty for the rest of 2023,” a Huawei spokesperson claimed in a statement.
“Nevertheless, we are continuously building out our mechanisms for global business continuity management and our agile operations management practice,” the spokesperson said.
“We are confident that we can meet our annual business targets and continue creating value for customers and culture at large.”
— CNBC’s Arjun Kharpal contributed to this report.