Under the influence of US sanctions, Huawei’s revenues may decline by $ 30 billion over the next two years. The company’s founder and CEO, Zhang Zhengfei, estimated the potential losses.
He acknowledged that he had previously underestimated the effect of restrictions.
The businessman first shared his concerns at a conference at the headquarters of the corporation in China’s Shenzhen, reports Reuters. Zhenfei admitted that the determination of the United States to break Huawei was unexpected for him.
The impact of sanctions that prohibit American companies from doing business with a Chinese firm turned out to be too large, and can not but affect the revenue giant in the telecommunications sector.
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According to the Wall Street Journal, in 2019, Huawei plans to earn about $ 100 billion, compared to last year’s $ 107 billion. And over the next two years, the company’s profits, according to Zhengfei, will be reduced by $ 30 billion by reducing capacity.
“We can not use anything with American components, and we can not even connect to networks that use such components,” said the company’s CEO.
Huawei’s smartphone shipments are expected to drop by 40%. However, Zhenfei hopes to revive the business in 2021. He added that the company avoided mass layoffs and reduced development costs.
The disappointing prognosis of Huawei’s head overwhelmed earlier comments from the company’s leadership that spoke about its technical self-sufficiency.
The collapse of cooperation with Huawei began after the decree signed by US President Donald Trump. According to the document, the company’s products allow China to spy on US authorities and threaten national security. In particular, work with Huawei has stopped Google, Qualcomm, Intel, Facebook, and Microsoft.