Huawei says profits surged 33% in 2012, as the company focused on expense control, customer service and management transformation. For all of 2012, Huawei earned 15.4 billion CNY ($2.5 billion) on revenue of 220.2 CNY ($35.4 billion). More than 13% of Huawei’s revenue went to research and development. While profit increased year-on-year, it is still below its 2010 level, a sign that while Huawei is increasing sales volume it may be slashing prices to win business.
Huawei has grown to be the world’s second-largest telecom equipment company, and even surpassed market leader Ericsson in revenue in the first half of 2012. But not all Huawei’s revenue comes from infrastructure equipment; the company also makes handsets and semiconductors. The private Chinese company is the subject of an ongoing investigation by the U.S. government, which is concerned about the possible security implications of a Chinese vendor gaining more control of America’s telecom infrastructure.
At a news conference, Huawei CFO Cathy Meng accused the United States of “trade protectionism,” and said that U.S. consumers pay about twice as much as Europeans pay for smartphone service. Last year when a U.S. Congressional committee warned American service providers about doing business with Huawei because of security concerns, Huawei responded by saying that Congress was stifling competition in an effort to protect American companies.
The news conference was the first with Western media for Cathy Meng, daughter of Huawei’s founder, Ren Zhengfei, who served as an officer in China’s People’s Liberation Army (PLO) before founding a company to import and sell telecommunications equipment in China. Huawei has evolved into a manufacturing powerhouse with customers all over the world. Meng said yesterday that the two thirds of the company’s revenue now comes from outside China.
At CES 2013, Huawei gave RCR Wireless News an overview of its successes in the U.S. market during 2012.