HONG KONG (Reuters) – Huawei Technologies Co., Ltd, the company’s founder and CEO, Ren Zhengfei, said the impact of a US ban on the Chinese company is worse than expected and warned that its sales would dip to around $100 billion this year and next.
Huawei’s founder Ren Zhengfei, participated in a panel discussion at its headquarters in Shenzhen, Guangdong province, China, and the 17th of June, 2019 at the latest. REUTERS/Aly Song
This is the first time that Huawei has quantified the impact of the US action against the company and, given the downbeat assessment comes after weeks of defiance, the responses of the managers who are maintaining and Huawei were technologically self-sufficient.
Huawei did not think of the US’s determination to “crack”) of the company, it would have to be “so strong and so all-pervading”, ” Ren said, speaking at the company’s Shenzhen headquarters on Monday.
In the United States, and Huawei is on a black list, which effectively bans U.s. companies from doing business with the Chinese company, which, it claims that Huawei’s products will enable China to spy on U.S. communications.
The ban has forced companies, including Alphabet, Inc., Google, and British chip designer ARM, to limit or terminate their relationship with Huawei.
Huawei’s global smartphone shipments will fall by 40 per cent, ” Ren said on Monday, without providing for a period of time. The international monetary fund said on Sunday that the technology giant was preparing for a 40% to 60% drop in international smartphone shipments.
Huawei was reported to have sales of 721.2 billion yuan ($104.16 million) last year, and did a couple of months ago, it is expected that the sales revenue this year, jumping to $125 billion.
“We did not expect that she was going to attack us on so many aspects,” Ren said, but added that he expects to see an upturn in business in 2021.
“We are able to supply parts, could not take part in a wide range of international organisations do not work closely with many of the universities are not allowed to use anything with U.S. parts, and you can also be able to connect to the networks that make use of these types of components.”
Ren, however, said the Smartphone will not cut research and development spending, despite the expected hit to the company’s finances, and will not be large-scale lay-offs.
Reporting by Sijia Jiang of Hong Kong and Brenda Goh in Shanghai; Writing by Sayantani Ghosh; Editing by Himani sarkar and Muralikumar Anantharaman