Huawei reports strongest earnings growth since 2019

Huawei Technologies witnessed a rebound in 2023, posting its fastest growth in four years fuelled by a resurgence in its consumer segment and increased revenue from new ventures such as smart car components.

The company's revenue surged by 9.63 per cent to 704.2 billion yuan ($97.48 billion) compared to the previous year, with the consumer business playing a significant role, witnessing a remarkable growth of 17.3 per cent to 251.49 billion yuan.

Last year's performance marks the third consecutive year of growth for Huawei, showcasing a steady recovery trajectory following US sanctions that severely impacted the company's operations. Despite this growth, the revenue remains below its peak in 2020.

Huawei's net profit in 2023 saw an impressive increase of 144.5 per cent to 87 billion yuan, with the net profit margin more than doubling from the previous year to 12.35 per cent. The surge in profits was partly attributed to ongoing payments from the sale of the Honor smartphone brand.

In addition to its core ICT infrastructure business remaining stable, Huawei's cloud business witnessed growth, generating revenue of 55.3 billion yuan, marking a growth of over a fifth. Furthermore, the company's smart car software and components business saw substantial growth, increasing by 128.1 per cent year-on-year to 4.7 billion yuan.

Huawei's announcement to spin off its smart car unit into a separate entity signals its commitment to capitalize on the growing opportunities in the automotive sector. Despite initial losses, reports suggest the smart car unit is expected to turn profitable from April onwards.

Rotating chairman Ken Hu expressed satisfaction with the results, noting the company's resilience amidst challenges. While Huawei refrained from holding its traditional press conference, the company's performance underscores its ability to adapt and thrive in a dynamic market landscape.

(With Reuters inputs)