Meng Wanzhou, chief financial officer of Huawei and daughter of the group’s founder, at a press conference in Shenzhen on 31 March 2023 (AFP/STR)
Chinese telecoms giant Huawei announced on Friday a sharp drop in profits in 2022 amid US sanctions and the appointment to its rotating chairmanship of Meng Wanzhou, the group’s chief financial officer and daughter of the founder.
Born in 1972, Meng Wanzhou was a few years ago at the heart of serious diplomatic tensions between China on the one hand and the United States and Canada on the other. His appointment was expected.
Huawei has been blacklisted by the US administration since 2019 in the context of technological rivalry with China and suspicions of espionage on behalf of the Chinese authorities.
This measure cuts the group off from global component supply chains but also from Google’s Android operating system, present on the vast majority of smartphones in the world. A situation which seriously weakens the telephone branch of Huawei, pushed in 2020 to separate from its entry-level brand, Honor.
In this context, Huawei announced on Friday a net profit down nearly 69% year on year for the year 2022.
The group posted a profit of 35.6 billion yuan (4.7 billion euros), against 113.7 billion yuan a year earlier. It was then his best historical performance.
Eric Xu, who will be replaced as Huawei’s rotating chairman by Meng Whanzhou, during the presentation of the group’s 2022 results in Shenzhen on March 31, 2023 (AFP / STR)
On the other hand, turnover is slightly up over one year (+0.9%), at 642.3 billion yuan (85.8 billion euros). In 2021, it was down more than 28%.
“In 2022, a difficult business environment and non-market factors continued to weigh on Huawei’s business,” the group’s current chairman, Eric Xu, admitted at a press conference.
– Diplomatic crisis –
“Significant investments in research and development” also explain this drop, a Huawei spokeswoman told AFP. “US restrictions are our new normal,” said Huawei chief financial officer Meng Wanzhou, who will succeed Eric Xu as Huawei’s rotating chairman on Saturday for six months.
The discreet executive had suddenly found herself at the heart of a diplomatic-judicial saga, exacerbated by a technological rivalry between the United States and China.
On December 1, 2018, Huawei’s number two was arrested at Washington’s request during a stopover at Vancouver airport (Canada).
A few days later, two Canadians, Michael Spavor, a businessman, and ex-diplomat Michael Kovrig, were arrested in China, causing a crisis between Beijing and Ottawa.
Charged with “bank fraud”, Ms. Meng was accused of having lied to circumvent American sanctions against Iran.
An offense punishable by more than 30 years in prison in the United States, to which she was threatened with extradition.
After nearly three years of proceedings, Meng Wanzhou was finally released in September 2021 and returned to China.
American justice definitively closed its proceedings against her in December 2022. In March of last year, during the presentation of Huawei’s annual results, Meng Wanzhou had made her first major media appearance since her legal setbacks.
– Under pressure from Washington –
Huawei press conference for the presentation of 2022 results in Shenzhen, March 31, 2023 (AFP / STR)
Huawei was once one of the top three smartphone makers in the world, along with Korea’s Samsung and America’s Apple.
The brand briefly held the number one spot, boosted by Chinese demand and sales in emerging markets.
Huawei did not release details of the number of cellphones it sold last year.
The firm is not listed and is therefore not subject to the same obligations of certification of accounts or details in the publication of its results as groups on the stock exchange.
Huawei is also the world’s leading 5G equipment supplier. But Washington has pressured its allies to give up the brand to equip their 5G networks, arguing that Beijing could use Huawei to monitor communications.
The firm is now refocusing on the Chinese market and diversifying its activities, particularly in cloud computing, connected cars and chip design. Based in Shenzhen in southern China, Huawei has some 207,000 employees and is present in more than 170 countries.
© 2023 AFP
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