Huawei sales grow but US scuffle takes its toll

Vendor's smartphone shipments rise by a quarter despite US blacklisting

Huawei claims to have seen revenue increase by almost a quarter during the first half of this year, but warned that it faces "difficulties ahead" as its tussle with the US continues.

The Chinese vendor said that its sales rose 23.2 per cent to CNY401.3bn (£3.4bn) in the six-month period to 30 June, with net profit at 8.7 per cent.

The vendor also grew its smartphone shipments by 24 per cent, despite recent sanctions imposed by the US government.

US manufacturers are currently banned from trading with Huawei, meaning the vendor cannot source crucial hardware and software needed to make its smartphones, including Google's Android operating system.

Huawei acknowledged that the dispute with the US could cause problems further down the line.

Chairman Liang Hua said: "Revenue grew fast up through May.

"Given the foundation we laid in the first half of the year, we continue to see growth even after we were added to the entity list. That's not to say we don't have difficulties ahead. We do, and they may affect the pace of our growth in the short term.

"But we will stay the course. We are fully confident in what the future holds, and we will continue investing as planned - including a total of CNY120bn in R&D this year. We'll get through these challenges, and we're confident that Huawei will enter a new stage of growth after the worst of this is behind us."

Huawei has been deadlocked with the US over claims that it has close ties to the Chinese government and could pass over information - which it vehemently denies.

Earlier this year US president Donald Trump banned US companies from dealing with Huawei, a move which, in some quarters, is seen as a ploy in his trade war with China.

Huawei founder Ren Zhengfei told press last month that he expects the impact of the blacklisting in the US to be greater than he expected, Reuters reported.

He said that it could cost the company $30m (£24.7m) in revenue, claiming that sales in 2019 and 2020 could be flat on 2018.

Over half of Huawei's sales came from its consumer business, namely smartphones, tablets, PCs and wearables.

CNY31.6bn came through its enterprise arm, with CNY146.5bn derived from its carrier division - which includes networking, IoT and 5G.