Huawei CEO says underestimated impact of USA ban, sees revenue dip

Sheri Evans
June 18, 2019

A technology cold war between the United States and China wil have no victor as both sides will suffer, said Huawei Technologies founder and chief executive Ren Zhengfei.

Ren said at the even that USA moves to restrict its business "will not stop us".

Even though $30 billion is a huge amount of money regardless of how you slice it, it doesn't exactly put Huawei in dire straits just yet. "So our sales revenue this year and next will be about $100 billion", Ren noted in a discussion in Shenzhen.

But today, Huawei CEO Ren Zhengfei admitted the us ban had a bigger impact than originally anticipated.

Negroponte, founder of the Massachusetts Institute of Technology Media Lab, said the US ban was a mistake.

Things are looking so grim that Huawei is actually considering pulling its latest flagship model, the Honor 20, from global sales, if it doesn't sell well, TechCrunch reports.

"They're doing it by their own desire because, for many of them, Huawei is one of their major customers", he said, adding that chipmakers knew that cutting Huawei off could have "catastrophic" consequences for them.

Washington's clampdown on Huawei is part of a broader push-back against the company, over worries about using its products in next-generation 5G mobile networks.

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Japan's Softbank and KDDI have both said they will not sell Huawei's new handsets for now. The exec conceded that Huawei didn't expect such an enormous hit.

Two U.S. tech experts, George Gilder and Nicholas Negroponte, also joined the session.

Zhengfei's statement is a marked departure from previous statements made by company executives, which suggested that Huawei could remain self-sufficient in spite of being blacklisted by the US.

A 40 to 60 percent decline in worldwide smartphone shipments is what Huawei is expecting, according to a Reuters report citing Bloomberg.

Ren said the company would regain its momentum and emerge stronger from the ordeal.

"Even if we were small, we have very strong business ethics and integrity, otherwise we can not come to where we are today", Ren said.

Huawei wants to secure as much as 50 percent of the entire phone market in China this year, but given the fierce competition in the country, this is without a doubt an ambitious goal.

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