The Chinese telecom giant Huawei Technologies Co. announced its earnings results as profit growth fell last year as margins dropped and it spent more money in its customer business.
Huawei Technologies is the world’s 3rd largest Smartphone-maker by sales after Samsung Electronics Co. and Apple Inc. It also is a leading manufacturer of wireless gear, competing with Ericsson and Nokia Corp.
Despite its worldwide market, Huawei has only a limited existence in the U.S., where its networking equipment is hurting due to concerns that the gear could be used by Beijing to spy on Americans. The company has repeatedly shorn of the accusations.
The company still sought a footing in the U.S. It has been speeding up efforts to sell its phones in the country, and this year launched its high-end Mate 9 Smartphone there for the first time.
But getting into the American market is still a hard task for Huawei because it lacks joint venture with major carriers, which give out the vast majority of phones in the U.S. The Americas zone accounted for 8% of revenue last year, Huawei said Friday, while China accounted for 45% and Europe, the Middle East and Africa made up nearly a third.
Huawei, founded by former Chinese army engineer Ren Zhengfei said Friday its full-year net profit rose 0.4% to 37.1 billion yuan, or about $5.39 billion, from 36.9 billion yuan in 2015. Revenue surged 32% to 521.6 billion yuan, as all three of its major business lines saw growth.
Meanwhile Revenue at Huawei’s consumer business segment, which comprises its smartphone business, surged 44% to 179.8 billion yuan, accounting for more than a third of all revenue. The company sold more than 139 million smart phones last year.
“In 2016, Huawei maintained its strategic focus and achieved solid growth,” said Eric Xu, Huawei’s current CEO.
Moreover company’s largest revenue maker remained its networking-equipment business, where revenue surged 24%. Revenue in its enterprise business section, which supplies internet infrastructure such as data centers, surged 47%.