Development Strategies of Huawei, 2020 and Beyond (pre-order)

In December 2018, the US government requested the Canadian police to arrest Meng Wanzhou pursuant to the extradition treaty between Canada and the United States. In May 2019, the US government restricted US firms from selling components and technology to Huawei and put Huawei in a difficult situation. In 2020, following embracing cooperate restructuring and supply chain strengthening strategies, Huawei has been attempting to maintain revenue growth and survive from global backlash against Huawei, especially the United States and its allies, while maintaining its leading position in the global communications market in the 5G era. This report provides an overview of Huawei in terms of revenue performance and market presence; points out three major challenges amid the US-China trade war and COVID-19 pandemic; examines countermeasures of the company in response to US government charges against Huawei, COVID-19 pandemic, and difficulties facing its business groups over the years.

1.Introduction of Huawei
1.1 Maintained Double-Digit Revenue Growth in 2019 Despite US Sanctions
1.2 Huawei Has Telecom Customers in All Markets Outside of the US
2. Challenges Facing Huawei
2.1 US Restrictions on Supply and Demand Hamper Huawei’s Market Expansion
2.1.1 Supply-side: Barriers on Huawei’s Acquisition of Critical US software and hardware components Increase
2.1.2 Demand-side - Restrictions placed in the name of national security on the purchase of Huawei equipment by US companies with alternatives suggested9
2.2 COVID-19 Epidemic May Negatively Impact Huawei in Two Ways
2.2.1 Mobile Carriers Delaying Their Network Upgrades and Reducing Their Annual Capital Expenditures
2.2.2 Many Countries Have Questioned China’s Handling of the Epidemic and Huawei May Be Caught in the Backlash
2.3 Slow Growth in Two Major Business Groups with Better Performance Needed in Europe and East Asia
3. Countermeasures of Huawei
3.1 Response to US Government and COVID-19
3.1.1 Actively Counter US Government’s Accusations through Litigation and Public Statements
3.1.2 Consolidation of Relations with Friendly European Nations
3.1.3 Huawei Aims for Becoming International Leader in Communications Technology
3.1.4 Improving the Self-Sufficiency in Critical Software and Hardware
3.2 Response to Issues Facing Business Groups
3.2.1 Consolidation of 5G Orders for Chinese Market
3.2.2 Corporate Restructuring to Create New BU for Cloud&AI and Smart Car
3.2.3 Continued Rollouts of New Products into Main Product Lines
4. MIC Perspective
Appendix
List of Companies

Table 1Huawei Revenue and Profit Performance, 2013 ~ 2019
Table 2Annual Revenue Growth of Huawei by Business Group and Geographic Region, 2013 ~ 2019
Table 3Huawei’s Response to US Government Sanctions
Table 4Leading US/Chinese ICT Vendors’ Lobbying Amount in the EU
Table 5R&D Spending of the Top Three Mobile Communications System Vendors, 2015 ~ 2019
Table 6Key Investments of Hubble Technology, 2019-2020
Table 7Outcome of Huawei Bids on China Mobile 5G Projects

Figure 1Huawei’s Revenue Distribution by Business Group, 2013~2019
Figure 2Huawei’s Revenue Distribution by Region, 2013~2019
Figure 3Huawei’s Market Presence in Key Telecom Equipment Markets, 2019
Figure 4Research Findings on 5G Patent Families
Figure 5Illustration of HiSilicon Product Lines
Figure 6Six Features of Huawei Cloud
Figure 7Huawei HiCar Product Features and Strategies
Figure 8Huawei 1+8+N Product Roadmap
Figure 9Huawei WeLink’s Four Key Product Elements and Results of Pre-Launch Trials

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