FILE PHOTO: Huawei’s new flagship store is seen ahead of tomorrow’s official opening in Shanghai, following the coronavirus disease (COVID-19) outbreak, China June 23, 2020. REUTERS/Aly Song/File Photo
(Reuters) – Huawei Technologies Co Ltd, the telecoms firm and No.2 smartphone maker, on Monday reported a 13.1% rise in revenue in the first half of the year, showing slower growth as U.S. officials continue to pressure the company’s suppliers and customers.
Revenue rose 13.1% to 454 billion yuan ($64.90 billion) in the first half of the year, compared to 401.3 billion yuan the year before. However, the company’s growth rate was down from 23.2% in the first half 2019. Huawei said net profit margins were 9.2%, up from 8.7% in the first half 2019.
The Chinese technology company posted the rise even as American officials have put increased pressure on the company’s suppliers and customers. The company sells 5G networking equipment to carriers and smart phones and laptops to consumers.
American officials placed Huawei on a blacklist in May of last year, restricting sales to the company of U.S.-made goods such as semiconductors. Huawei built up inventories and also continued to design its own chips and have them manufactured by Taiwan Semiconductor Manufacturing Co Ltd and others.
In May, U.S. officials announced new rules aimed at constricting Huawei’s ability to self-supply chips, an ability that is critical to its efforts to sell 5G networking gear.
The first half results showed faster growth than Huawei’s first quarter results released in April. For the first quarter, revenues rose by about 1% to 182.2 billion yuan, versus 39% growth posted a year previous. Net profit margin in the first quarter narrowed to 7.3% from about 8% a year earlier.
Huawei did not report unit shipments of phones. Research firm IDC reported Huawei was the second largest phone maker in the first quarter of 2020, with 17.8% market share, behind No. 1 Samsung Electronics Co Ltd and ahead of No.3 Apple Inc.
Reporting by Stephen Nellis from San Fransisco; Editing by Arun Koyyur and Chris Reese