SHENZHEN, CHINA (AFP) – Huawei posted a massive drop in 2022 profits yesterday, as the company battered by United States (US) sanctions appointed its CEO’s daughter to be its rotating chair.
A leading supplier of telecom gear, smartphones and other advanced equipment, a US-led pressure campaign in recent years has taken a major chunk out of Huawei’s businesses.
And after posting record profits for 2021, the firm yesterday reported CNY35.6 billion (USD5.2 billion) in net profits in 2022 – a fall of 68.7 per cent year-on-year.
“In 2022, a challenging external environment and non-market factors continued to take a toll on Huawei’s operations,” the company’s outgoing rotating chairman Eric Xu said at its 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,” he said.
“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,” he added.
Taking over as chair – a role that lasts six months – is Meng Wanzhou, daughter of billionaire CEO and founder Ren Zhengfei.
“In accordance with Huawei’s rotating chair system, Sabrina Meng will assume the position of rotating and acting chair of Huawei from April 1 to September 30,” Huawei said in a statement, referring to Meng by her English name. “During her term, Meng will serve in the company’s top leadership position and head the board of directors and its executive committee,“ it added.
Meng was Huawei’s chief financial officer when she was arrested in Vancouver in December 2018 in a case that became a major thorn in relations between China and both the US and Canada.
The US sought her arrest for wire fraud and deceiving HSBC bank, relating to her alleged efforts to hide violations of US sanctions on Iran by Huawei affiliate Skycom.
And during the same period that Meng was held under house arrest, Washington intensified a campaign against the use of Huawei equipment in the US and allies, saying it posed deep security threats.
Meanwhile China arrested and held two Canadians – former diplomat Michael Kovrig and businessman Michael Spavor – forcing talks on what became labelled “hostage diplomacy”.
Meng returned home in September 2021 shortly after the two Canadians were released from prison in China, after lengthy negotions between Beijing and Ottawa.
Since then Huawei’s fortunes have dimmed further.
The firm was hammered during a crackdown by the administration of previous US president Donald Trump over cybersecurity and espionage concerns.
