x
Optical/IP

Huawei Beats 2005 Sales Target

Chinese giant Huawei Technologies Co. Ltd. says the value of deals it was awarded in 2005 totaled $8.2 billion, a year-on-year increase of nearly 47 percent over 2004's $5.58 billion. (See Huawei Hits $8.2B in 2005 and Huawei's Global Sales Hit $5.58B.)

The annual figure, which represents the value of contracts signed and not audited revenues, is slightly above the company's target of $8 billion for 2005. It says it has experienced growth in sales of wireless networks and handsets, optical equipment, data products, next generation network (VOIP) systems, and its software and applications offerings.

And the vendor plans to ramp up by about the same level this year: It has a 2006 sales target of $12 billion, according to a Light Reading Insider report, China's Big Three Vendors Take On the World. (See Telecom's China Syndrome and Insider Analyzes China's Big Three.)

The company continued to make progress in 2005 with carrier customers at the expense of more traditional telecom equipment vendors, and is now peddling its own technology solutions in some of the sectors hot areas, such as IPTV and IMS. (See Algeria Telecom Picks Huawei, Huawei Meets Vodafone's Needs, Arcor Picks Huawei , Huawei Lands NGN Deal, Huawei, ZTE Ramp Up IP Access, Huawei Doubles Up at KPN, Etisalat, Huawei Sign MOU, Tiscali UK Unbundles With Huawei, China's 'Big Three' Eye IPTV, BT Unveils 21CN Suppliers, Huawei Lands Deutsche Deal, and Huawei, Ubiquity Ally.)

Huawei, though, didn't have everything its own way in 2005. (See BSNL Shuns Huawei.)

However, according to a Huawei spokesman no additional financial details are yet available, which will frustrate other vendors and industry analysts: They'll want to know the firm's actual revenues, which in 2004 were $3.8 billion, about 68 percent of the value of its awarded contracts.

They'll also want to know whether Huawei is still increasing the international portion of its total sales, which in the first half of 2005 accounted for 62 percent of its sales deals. (See Huawei H1 Sales Hit $4.1B.)

Growing sales outside China is a major goal for Huawei and its main domestic competitor, ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763). (See ZTE Makes International Headway.)

And European telecom watchers will be keen to see if Huawei achieved its sales target for that region. In June last year the company said it was on course to triple its European sales in 2005 to $600 million. (See Huawei Plans to Triple Euro Business.)

— Ray Le Maistre, International News Editor, Light Reading

Page 1 / 2   >   >>
csconomore 12/5/2012 | 4:09:09 AM
re: Huawei Beats 2005 Sales Target One cannot question Huawei's contract awards, and the revenue growth that brings.

The question should ask how accurate the financial reports of the "incumbents" are? They are the ones losing significant contracts and revenue to Huawei.
digits 12/5/2012 | 4:09:09 AM
re: Huawei Beats 2005 Sales Target Until Huawei goes public - and the answer to when that will happen has ben consistent for the past 2 years, "when the time is right" - it's going to be impossible to know how well Huawei is really doing.

Given the less than encouraging operating margins at some of its competitors, such as Nortel and Siemens Comms, it would be interesting to know how Huawei compares like for like.
chips_ahoy 12/5/2012 | 4:09:09 AM
re: Huawei Beats 2005 Sales Target Why isn't Huawei going public now? They seem to be larger (more successful) than ZTE who is listed in HK. Are they afraid to open their books? Are their financial tactics on the same ethical plane as their 'R & D'?

Mr Chips
paolo.franzoi 12/5/2012 | 4:09:08 AM
re: Huawei Beats 2005 Sales Target
Actually, you can question the contracts. UT Starcomm used to (and probably still do) report these contracts and say things like, "We now have the next 2 years of revenue in contract awards." Implying that they understand their exact revenue picture. Given where UT is now, one would have to say that these are not guaranteed contracts. The same is likely true for Huawei.

seven
dmw_qqqq 12/5/2012 | 4:09:08 AM
re: Huawei Beats 2005 Sales Target A private, multi-billion $ revenue, IPO-eying company's finance is always interesting (or frustrating) to peopleGǪ.remember Google before its IPO?

I doubt they are going to spew out much more detail unless the IPO is imminent.

-dmw
Honestly 12/5/2012 | 4:09:05 AM
re: Huawei Beats 2005 Sales Target Yes, and they can say and do anything they want unless thery are really serious about IPO. I met with a senior officer there a few years ago and flexibility was very clear.
optiplayer 12/5/2012 | 4:09:02 AM
re: Huawei Beats 2005 Sales Target "One cannot question Huawei's contract awards, and the revenue growth that brings"

Of course, I mean who could question contracts like the 1M lines of CDMA that Huawei was awarded by BSNL?

Oops...
SIVROCX 12/5/2012 | 4:09:01 AM
re: Huawei Beats 2005 Sales Target Revenue is a very powerful tool, but lets remember that initially at least they might not be looking for profitable revenue. Why not just drive everyone else out of the teloc market and then make money. My humble prediction is now that China produces most of the clothing we will not just be standing around naked because we can no longer afford cloths, we will be standing naked with our cell phone inhand that we can ill afford to use........+£
melao 12/5/2012 | 4:08:55 AM
re: Huawei Beats 2005 Sales Target "Revenue is a very powerful tool, but lets remember that initially at least they might not be looking for profitable revenue. Why not just drive everyone else out of the teloc market and then make money. My humble prediction is now that China produces most of the clothing we will not just be standing around naked because we can no longer afford cloths, we will be standing naked with our cell phone inhand that we can ill afford to use........+£"

If you like Nike shoes be aware too! :)
Mark Sebastyn 12/5/2012 | 4:08:52 AM
re: Huawei Beats 2005 Sales Target The reality is until external auditors sign off on these numbers they shouldn't hold the weight they do.

Huawei uses secrecy in technology as a competitive advantage. Anyone who has visted Huawei and had the ports on their laptops taped shut knows this is the case. It isn't surprising this would extend to the financial realm. I'm not saying these numbers are false, I'm just saying that without external verification they are irrelevant.

Bookings, in particular, are particularly 'flexible'.

The sad thing is there isn't much critical analysis from the financial community as they are hoping to score the investment banking coup of the decade if/when Huawei goes public.

Andrew
More at http://www.nyquistcapital.com/
Page 1 / 2   >   >>
HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE