Huawei’s growth slowed in 2017 despite gaining on Apple

Huawei suffered its slowest YoY revenue growth since 2013 last year, despite temporarily knocking Apple into third place in global smartphone shipments.

The company’s revenue for the year grew around 15 percent to 600 billion yuan ($92 billion) in 2017, according to a letter posted to the company’s WeChat from Huawei’s rotating Chief Executive Officer Ken Hu.

Hu attributes this slow growth to stagnation in the carrier market. Construction of next-generation networks hasn’t yet taken off but is set to do so imminently with 5G on the horizon.

“Our carrier business was affected by market investment trends but remains stable,” Hu wrote in his memo. “The market’s fluctuations makes us more determined to team with carriers to explore and grasp future opportunities.”

In 2017, Huawei’s consumer division — responsible for devices including smartphones and smartwatches — is expected to have risen 30 percent to generate 236 billion yuan ($36 billion).

After conquering the Chinese market, Huawei now has its sights on Apple when it comes to global smartphone shipments. Samsung leads the market but Huawei and Apple have been fighting it out for second place.

According to an analysis by consulting firm Counterpoint Research, Huawei surpassed Apple’s global smartphone sales for the first time last June and July. Apple’s latest smartphones released in September tentatively returned the company to second place.

Huawei is stepping up its expansion into overseas markets such as Europe and is said to be in talks with US carriers about selling its phones on Apple’s home turf. While the company has typically been known for its mid-range smartphones, Huawei has been moving into high-end flagships in recent years with impressive features.

However, to be successful in the West, Huawei will need to deal with internal problems staining its image. Last month, Huawei announced its head of sales for its China consumer business had been detained in a corruption probe.

“We were disappointed to see that there are still employees and managers who were turned over to judicial authorities this past year,” Yu said. “I would like to stress, once again, that the company has zero tolerance for corruption. Do not take chances.”

You can find my review of the Huawei Mate 10 Pro and its AI capabilities here.

What are your thoughts on Huawei’s past year? Let us know in the comments.

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