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Apple's China gloom turns Huawei's boom; profit surges over 500 percent
TOI Tech Desk / TIMESOFINDIA.COM / Updated: May 1, 2024, 07:03 ISTHuawei impresses with a 560% profit surge in Q1 2024, reaching $2.7 billion. Revenue hits $24.7 billion. Despite US sanctions, Huawei's strategic diversification pays off, leading to growth and innovation in various tech sectors.
Chinese tech giant Huawei defied expectations with a massive surge in profits for the first quarter of 2024. The company's net profit skyrocketed over 560% compared to the same period last year, reaching $2.7 billion. Revenue also grew significantly, rising 36.7% year-on-year to $24.7 billion.
According to market research firm Counterpoint, Apple witnessed a 19% slump in iPhone sales during the first quarter of 2024. The company fell to No. 5 in the past quarter. This news follows a positive trend for Huawei, with the company previously announcing that their profits doubled in 2023.
This impressive comeback comes after Huawei faced significant challenges due to US sanctions imposed in 2019. The restrictions limited the company's access to American-made components, hindering its smartphone production.
In response, Huawei adopted a strategic diversification plan. The company invested heavily in areas like 5G technology, artificial intelligence, and smart-driving tech, successfully reducing their reliance on smartphone sales.
While details on profit breakdown by sector weren't provided, the overall results indicate the diversification strategy's effectiveness.
It's important to note that Huawei is a private company, exempting them from the detailed financial disclosures required of publicly traded firms.
Despite the limitations, Huawei managed to launch the Mate 60 Pro last year, a high-end smartphone featuring a powerful chip. Experts believe such advancements wouldn't be possible without foreign technology, raising questions about the true impact of US restrictions.
A Huawei representative attributed the recent growth to "opportunities in digitalization, intelligence, and decarbonization." They acknowledged global uncertainties but expressed confidence in achieving their annual targets and maintaining sustainable growth.
US-China tensions continue
The positive news for Huawei comes amidst ongoing tensions between the US and China. The two major powers continue to clash over various issues, including trade and Taiwan. Notably, the US has lobbied allies to ban Huawei's 5G technology due to security concerns.
