SHENZHEN: Chinese telecom giant Huawei vowed on Friday to “shake off outside distractions” as it announced that its telecom infrastructure business contracted slightly in 2018 amid a global US campaign to blacklist the company over espionage fears.
Huawei said net profit rose to 59.3 billion yuan last year, up 25pc.
But its carrier business, which supplies telecom infrastructure to much of the world, posted a rare decline, suggesting that the US pressure could be having an impact.
The company’s carrier business was down 1.3pc on the year, compared to growth of 2.5pc in 2017 and annual increases typically in excess of 20pc in years past.
Huawei is the leading manufacturer of equipment for next-generation 5G mobile networks that will bring near-instantaneous connectivity for smartphones, but faces pushback in some Western markets over fears Beijing could gain access to critical infrastructure.
“Security concerns are having an impact on Huawei, as more and more countries place restrictions on the firm’s network gear,” said Brock Silvers, managing director of Kaiyuan Capital.
“Moreover, the US-led global movement has only just begun and is unlikely to quickly recede even in the event of a trade war agreement.” Huawei’s annual report, released at corporate headquarters in the southern city of Shenzhen, did not detail what caused the carrier business decline or make clear reference to the global pressure.
But the company vowed to press ahead.
“Moving forward, we will do everything we can to shake off outside distractions, improve management and make progress towards our strategic goals,” rotating chairman Guo Ping said.