Since the Washington trade ban on the Chinese tech giant Huawei, there hasn’t been a word that quantifies the extent of the ban in Huawei’s business. However, through thick and thin, the Chinese tech company has been preparing well for life after Google and all of its US-based partners that cut off business with the company. So far Google, Qualcomm, Broadcom, Intel and ARM among other companies, have cut ties with Huawei.
Huawei Founder Ren Zhengfei has confirmed that the trade ban has profoundly affected Huawei’s business in a big way. Ren expects that the company sales would curtail by about $30 billion over the next two years. A $30 billion loss in revenue will mean that Huawei’s revenue will stall at around $100billion in 2019 and 2020.
In the past month, Huawei has endured a 40% drop in smartphone shipments abroad. “We didn’t expect the damage to be this serious,” Huawei’s CEO stated.
Huawei at the start of the year had a target to be the leading smartphone seller by Q4, but the plans have been put on time off after the Washington trade ban. Despite the current state of issues, Huawei will still maintain its research and development budget while at the same time refrain from asset sales and layoffs, Ren stated.
Huawei in 2018 made a revenue of 721.2 billion Yuan (~$104.16 billion), which was a 19% increase from the previous year. A $100 billion revenue in the next two years would mean the company’s growth will be stalled. However, Ren estimates that the company’s growth will be back in the track by 2021 “We will be reborn by 2021,” he stated.