Huawei Wraps Up An Impressive Year, Outlines 2013 Objectives

by Gaurav Kheterpal on January 7, 2013

2012 was a turbulent year for Huawei, and for all Chinese telecom vendors in general. They were subject to American fear-mongering – accused of “posing a national security threat” and thereby American businesses were discouraged from buying their equipment.

While Huawei kept countering accusations from the Americans over its telecommunications equipment, with some politicians suggesting that Chinese government agents could be using it to do damage to foreign communications equipment. Canada also watched Huawei closely for this purpose, with the Communications Security Establishment keeping an eye on things.

Despite those setbacks, Huawei rounded off an impressive year 2012  as sales surpassed $35 billion (218.1 billion yuan), with net profit around $2.4 billion (15 billion yuan) – a 29% YoY (Year on Year) increase.

In a letter to employees dated Dec. 31, acting Chief Executive Guo Ping reported these figures and thanked staff for helping Huawei outperform the market in 2012. He attributed this success to the rapid proliferation of smartphones and tablets, thereby increasing the need for more network infrastructure. Huawei also staked claim to be the world’s biggest supplier of LTE and evolved packet core networks, having deployed 130 and 70 thereof respectively. Guo outlined that Huawei’s strategic objective in 2013 is to establish leading positions in mobile broadband, fixed broadband and backbone network solutions.

“Our value does not simply lie in our capability to help customers lower their procurement costs. More importantly, it lies in our capability to increase their competitiveness and profitability,” he said. “There was a time when rapid growth was Huawei’s priority and strong execution was Huawei’s distinctive feature. These characteristics have contributed to our fast development, and at the same time created the lingering issue of extensive management at Huawei. As business growth becomes steady and moderate, we have to ensure reasonable profits to support our continuous strategic investment.”

Huawei plans to “control the pace of expansion” in the coming years to avoid an encore of its recent “extensive management,” which resulted in expensive and inefficient application of human resources. The company also needs to gets its act together in the enterprise business, a widely used tactic by other telecom vendors to make up for a slower infrastructure business.

While Huawei had an impressive year, it’s not known if the Chinese giant managed to surpass rival Ericsson as the latter is yet to report its full-year figures. Ironically though, Huawei’s neighbour and rival ZTE, the fifth largest telecoms equipment manufacturer in the world, recently reported the biggest quarterly loss since its IPO.

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Written by: Gaurav Kheterpal. www.digitcom.ca. Follow TheTelecomBlog.comby:RSS,TwitterFacebook, or YouTube.

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