Huawei has seen a gradual rise in research and development (R&D) investment, with total investment of more than CNY977.3 billion (about R2.5 trillion) over the past 10 years.
Last year, the Chinese ICT firm recorded R&D expenditure of CNY161.5 billion (about R419 billion), which it says represents 25.1% of the company's annual revenue.
This is based on Huawei’s 2022 annual report, released on Friday.
The report shows Huawei invests over 10% of its sales revenue in R&D annually.
At the end of 2022, over 114 000 employees, or 55.4% of the 207 000 Huawei workforce, worked in R&D, it adds.
"In 2022, a challenging external environment and non-market factors continued to take a toll on Huawei's operations,” said Eric Xu, Huawei rotating chairman, at the company's annual report press conference.
"In the midst of this storm, we kept racing ahead, doing everything in our power to maintain business continuity and serve our customers. We also went to great lengths to grow the harvest – generating a steady stream of revenue to sustain our survival and lay the groundwork for future development."
Sabrina Meng, HuaweiCFO, adds: “In 2022, our total R&D spend was CNY161.5 billion, representing25.1% of our total revenue – among the highest in Huawei's history. In times ofpressure, we press on – with confidence.”
According to Huawei, it still has a positive outlook, with its financial results in line with forecasts, despite continued pressure witnessed in 2022.
The company reported overall revenue of CNY642.3 billion (about R1.6 trillion) in 2022, with a net profit of CNY 35.6 billion (about R91 billion).
For the period under review, revenue from Huawei's carrier, enterprise and consumer businesses was CNY284 billion, CNY133.2 billion and CNY214.5 billion, respectively.
The report indicates revenue for the enterprise business group was up 30%, while the consumer business saw its revenue decline by 11.9%. Carrier business group revenue was up 0.9%.
“2023 will be crucial to Huawei's sustainable survival and development,” Xu noted. “Plum blossoms tend to grow sweeter from a harsh winter's freeze. Today, Huawei is like a plum blossom.
“While it's true that we have considerable pressure ahead of us, we have what it takes to come out the other end – with opportunities to grow, a resilient business portfolio, a unique competitive-edge, the enduring trust of our customers and partners, and the courage to invest heavily in R&D.”
The Huawei cloud computing business recorded revenue of CNY45.3 billion (about R117 billion).
According to Huawei, together with its partners, it has built a global presence in 29 regions, with 75 availability zones, serving customers in more than 170 countries and regions by the end of 2022.
“In Southern Africa, Huawei Cloud provides cloud services in 14 countries, which have attracted customers from more than 50 African countries.
“We have made rapid progress in the government, telecommunications, finance, manufacturing and mining industries. In Northern Africa, Huawei Cloud has set up local service teams in more than 10 countries and has become a preferred partner for government and enterprise customers undergoing digital transformation.”
Turning to HarmonyOS, its in-house smart device operating system, the company indicates it had been deployed on 330 million Huawei devices by the end of 2022.
Huawei has been building its HarmonyOS ecosystem following restrictions placed on the company by the US government, which prevented the use of Google services on Huawei smartphones.
The company says over the past four years, HarmonyOS has evolved to deliver new functions and a “user-friendly” experience.
“HarmonyOS 3 was officially launched in 2022, representing a full expansion of the Super Device feature, which is now available on 12 different device types, including smartphones, tablets, PCs, Huawei vision products, earphones, smart watches and head units, facilitating effortless cross-device interactions.
“HarmonyOS Connect, the technology brand that supports the HarmonyOS ecosystem, has attracted more than 2 300 ecosystem partners and continues to add more product categories.
“In 2022, over 181 million new devices in the HarmonyOS Connect ecosystem were shipped, covering numerous types of smart home appliances. By the end of 2022, there were more than two million HarmonyOS ecosystem developers.”
Huawei concludes it will continue to increase investment in the HarmonyOS ecosystem and provide more related training.
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