Security Strategies

Huawei Expects 2018 Revenues of $108.5B

Huawei is bigger than ever and will never be a security risk. Those are the key points made by the company's rotating chairman Guo Ping in the vendor's annual end-of-year message to the industry.

Ping noted that, despite many challenges during an "eventful" year, which included its CFO being arrested, the company is expecting to report a 21% year-on-year increase in group revenues to the equivalent of US$108.5 billion for 2018. (Note: The company did not state how it arrived at the 21% figure -- for example, that might be the increase in Chinese yuan at constant currency exchange rates.)

Huawei Technologies Co. Ltd usually announces its audited revenues and profit margins in late March or early April: For the full year 2017, the company reported a 15.7% increase in group revenues of 603.6 billion yuan (equivalent to $92.5 billion based on the exchange rate at the end of 2017).

Ping's message included a string of figures to show the importance of the company to the world's network operators:

    "We have signed 26 commercial contracts for 5G with leading global carriers, and have already shipped more than 10,000 5G base stations to markets around the world. More than 160 cities and 211 Fortune Global 500 companies have selected Huawei as their partner for digital transformation. We have shipped more than 200 million smartphones, and have made remarkable breakthroughs in both our PC business and IoT ecosystem for smart homes. Huawei Cloud has launched over 140 cloud services in 18 categories, and we are working with our partners to serve global customers with 37 availability zones across 22 regions … Our business performance remains strong, and this is by far the most direct form of validation that we can receive from our customers. It is also our best response to negative conjecture and market restrictions. Here I would like to thank all of our customers and partners, as well as the public, for your trust and support."

That "negative conjecture" and the market restrictions have been widely reported during the past few months: Huawei is essentially being portrayed by its naysayers (led by the US administration) as an agent of the Chinese government and, as such, a national security threat to any country where its technology is deployed in critical and/or communications networks and, as a result, is being omitted from 5G deployment strategies in certain countries and by certain operators. (See Huawei's Hu Hits Back, Telecom Italia Stands by Huawei as Peers Waver, Orange Rules Out Huawei for 5G in France and Light Reading's 22 Most Popular Huawei Stories in 2018.)

Ping was defiant, while noting that during the coming year "we may very well encounter even greater difficulties." That will certainly be the case if there's any truth to a Reuters report that suggests the Trump administration in the US is considering issuing an executive order that would bar any US companies from using technology made by certain companies, with Huawei and its fellow Chinese vendor ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) among those that would be impacted.

But Ping stuck to the company's line that its technology does not pose any kind of security threat. He stated:

    "We have a very strong track record in cyber security. Huawei has never and will never present a security threat. [Note: Italics are as used by Huawei.]

    "Today, the trustworthiness of ICT products has become the top concern of our customers, and solid software engineering capabilities and practices are the foundation for building this trust. We will hold ourselves to the highest standards, placing cyber security and privacy protection at the very top of our agenda. We plan to systematically enhance our software engineering capabilities over the next five years, building trust and high quality into each and every one of our products and solutions."

He also noted that Huawei plans to optimize its portfolio by reducing investments in certain (unspecified) areas to focus on "areas of strategic opportunity," and loosen central control to give more powers to regional operations.

— Ray Le Maistre, Editor-in-Chief, Light Reading

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