The Chinese tech group Huawei has seen profits plummet by almost 70 percent in 2022. The US sanctions against the company cause a sharp drop. As a result, Huawei has seen a large sales market for its mobile phones disappear.
The company’s mobile network equipment is also banned in the United States and more and more European countries.
The Shenzhen-based company made a net profit of 35.6 billion yuan last year, converting about 4.8 billion euros. In 2021, Huawei posted another record profit of nearly 114 billion yuan. It was the first time in more than ten years that the company had seen its profits drop.
Turnover did increase slightly to more than 642 billion yuan or more than 85 billion euros. However, the company emphasized investing more than a quarter of its turnover in research to develop alternatives to the American parts and software to which it no longer has access.
Before the Americans cut off Huawei’s access to key components and banned the use of Google’s Android operating system, the company was the largest smartphone manufacturer in the world. Recently, founder Ren Zhengfei said the company had to replace thousands of parts in its products as US sanctions hit them.
Huawei has been facing trade restrictions imposed by the US since 2019. The US government accuses Huawei and other Chinese tech companies of enabling espionage through back doors in their technology. Huawei has always denied those allegations. Canada, Australia, the United Kingdom, Japan and Sweden have also banned or restricted the use of Huawei telecom equipment.
