Huawei Posts Tripled Net Income In H1 as Flagship Smartphone Mate 60 Fuels 5G Speculation

BEIJING, September 1 (TiPost)— Huawei Technologies Ltd reconfirmed its counterattack with the latest financial results and a new flagship smartphone presale, which fueled speculation about a 5G comeback.

Credit：Visual China

During the first six months of the year 2023, Huawei posted revenue of RMB308.29 billion (US$4.25 billion) with a year-over-year increase of 3.24%, reversing a 5.87% YoY decline a year earlier, according to an interim report earlier this week. The report showcased revenue growth significantly accelerated this year and Huawei had much more robust increase at the bottom line. An annual report said revenue last year just edged up 0.9% to RMB64.23 billion. The Chinese tech giant increased gross profit 209% YoY to RMB52.16 billion from January to June, and its net income surged 218% YoY to RMB46.52 billion in the period, 30.8% more than that for the whole year of 2022.

The recent report also showed Huawei’s ongoing investments in research and development (R&D). The Shenzhen-based company has input RMB82.6 billion in R&D during the first six months this year, accounting for 26.8% of the total revenue, while its annual R&D expense of RMB161.5 billion made up 25.01% of revenue last year. The company had more than RMB977.3 billion of R&D expanse over nearly a decade, according to a yearly report of 2022. “The true value of Huawei lies in the R&D capabilities we have accumulated through our constant, long-term investment in research,” Meng Wanzhou, the eldest daughter of Huawei founder Ren Zhenfei said in March, 2022. “It’s in the company’s basic law that we will spend 10% of our annual revenue in R&D.”

Huawei released some of financial results in the first half of year in mid August.The profit margin stood at 15%, tripling from 5.0% in the year-ago period. Huawei’s core business information and communication technologies (ICT) infrastructure, including carrier and enterprise services, generated RMB167.2 billion. The second largest contributor consumers business, which includes smartphones and electric vehicles (EVs), brought RMB103.5 billion, representing a 2.2% YoY growth, slower than the company’s overall revenue increase but recovering from a sharp fall of 25.4% a year ago.

Huawei said these half-year sales and margin were in line with its forecast. ICT infrastructure maintained solid, consumer sales delivered positive growth, digital power and cloud businesses achieved good growth, and new components of intelligent automotive continued to become more competitive, said Meng Wanzhou, the rotating chairperson of Huawei starting from April 1. 

The consumers business had much more room of growth as the latest flagship smartphone received warm welcome in China. Huawei surprisingly launched a presale for Mate 60 Pro priced at RMB6,999 (US$960) on Tuesday even though it has not officially released the model. While the company didn’t provide details about technical specifications or whether the phone supports the 5G network, Chinese media outlets including Huxiu said online tests proved Mate 60 Pro can deliver the internet speed of 5G.

Download speeds of the new Mate can reach 500 megabits per second (Mbps), which exceeds the 100Mbps speed requirements for 4G networks, and the maximum speed is 800 Mbps, according to results of various tests circulated online. Chinese benchmarking website AnTuTu later identified the central processing unit (CPU) in the model as the Kirin 9000s from Huawei’s chip design unit HiSilicon. The CPU has a 12-core configuration and a top clock speed of 2.62 gigahertz (GHz), according to AnTuTu. The most compelling feature that Huawei confirmed is that Mate 60 Pro can make calls through a satellite orbiting the Earth in areas without any mobile signal, making it the world’s first phone with satellite calling feature.

The resurgence of Huawei smartphones after three years of forced silence is enough to prove that the U.S.’ extreme suppression has failed, according to an editorial of the state-backed newspaper Global Times. The paper noted Mate 60 Pro’s presale has ignited a fervent discussion in Chinese society surpassing the usual buzz surrounding launches. It said the excitement and intense attention from the public regarding the return of Huawei’s chip Kirin highlight a strong anticipation and confidence in China’s independent technological R&D.

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