Huawei predicts earnings rebound for 2012

Caroline Gabriel/Wireless Watch
11 Jan 2013
00:00
News
Commentary

Huawei expects to deliver more than 10% increase in both net profits and revenues for 2012, according to acting CEO Guo Ping. The vendor anticipates sales revenue to top $35 billion with net income of $2.4 billion, reversing the growth slump suffered in 2011.

In that year, Huawei's bottom line halved to $1.85 billion – at a time when rival Ericsson delivered 12% growth - despite a revenue increase of 11.7% to $32.4 billion. Huawei credited the upturn in its fortunes to several factors – the recent enterprise push, and success in LTE and evolved packet core, where it claims to be the leading vendor. Guo claimed Huawei had deployed 130 LTE networks and 70 EPC deals.

He added that "the smartphone business has made breakthroughs in scale in high end markets such as Japan, the US and Europe,” and the firm will launch three smartphones, including a Windows 8 model, at this week's Consumer Electronics Show.

The CEO tried to temper expectations, saying future growth patterns would be “steady and moderate,” and it would be vital to increase efficiencies to maintain profitability. “We should devote our limited energy to specific business objectives, and avoid the impulse to expand business blindly,” he said in his new year's message to staff.

He outlined strategic objectives for 2013, including “to establish our leading positions in mobile broadband, fixed broadband, and backbone network solutions,” according to Reuters.

Huawei has yet to report audited figures, which it plans to do in the next few months. Its major challenge lies in the toughening US hostility to the firm, which has led to government agencies warning operators against buying critical equipment from Huawei or ZTE.

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