On October 31, Huawei Investment Holdings Co., Ltd. (Huawei) released its third quarter financial statements for the year 2024. The report revealed a 13.8% year-on-year decline in net profit attributable to the parent company for the first three quarters of this year. Huawei’s founder Ren Zhengfei expressed that the company is still facing challenges and struggling.
According to the financial report disclosed by Huawei on the first financial news on October 31, the operating revenue for the first three quarters of this year was 585.9 billion yuan, with a net profit of 62.9 billion yuan attributable to the parent company. In the same period last year, Huawei recorded sales revenue of 456.6 billion yuan and a net profit of 73 billion yuan, indicating a 28.3% year-on-year growth in revenue and a 13.8% decrease in net profit.
Huawei has not provided detailed disclosures on the financial report or published relevant data on its official website.
Financial experts speculated to the first financial news that Huawei’s profit decline in the first three quarters of this year may be related to the settlement time of business divestments such as Honor and Super Fusion. Huawei’s annual report from last year revealed that part of Huawei’s profit came from the fair value changes of financial instruments generated from the sale of Honor and server businesses, which were settled at the end of last year.
Although Huawei did not disclose the performance of each segment in its quarterly report, market research institutions indicate that the performance of Huawei for the first three quarters of this year was supported by the mobile terminal, automotive business, and the computing system relying on the Ascend platform.
An internal source from Huawei stated, “Currently, Huawei is still facing challenges due to the complex external environment. From survival to development, how the company builds a stronger supply chain capability to ensure business continuity and product competitiveness is the core of future continuous development.”
During a meeting with the International Cable Protection Committee (ICPC) on October 31, Ren Zhengfei also mentioned, “Up to today, we cannot say that we will survive.”
In market information on October 31, Ren Zhengfei mentioned that 99% of Chinese companies can collaborate with the United States, they are not sanctioned, their chip computing power is higher than ours, and they can access better things. Under such circumstances, whether we can survive in the coming years remains uncertain. He emphasized that despite appearing gathered with everyone today, they are still struggling.
Ren Zhengfei’s remarks sparked discussions among Chinese netizens. Over 4,000 netizens on Baidu participated in the conversations.
One netizen “痴惗” commented, “Huawei cannot rely on water armies or national support for broad domestic support. They must win a broad public base and gain genuine user support through their own strength and efforts. Your current products do not meet the basic national conditions, how many in China are wealthy? Have you considered whether your high-end route is compatible with the basic national conditions? Those with popular support will succeed; hiring so many water armies to defend you is useless if you lack a popular base.”
Another netizen “homelessbaby16” expressed, “Huawei’s machines are slow, this is a fact. At the same price point, the 16 GB running memory subsidized by Taobao this year is almost the same as the 12 GB Motorola bought two years ago. I can relate! I don’t have money, so I can only buy low-end machines, but they are filled with various unwanted applications that cannot be removed. Huawei is so wealthy now, can they give us a clean machine instead of following the capitalist route? You promote patriotism, but why not be good to your compatriots?”
A Baidu netizen 8d71b6e76b interpreted Ren Zhengfei’s words as, “Translated, it means he hopes the Chinese people will continue to support Huawei. Although the mobile business has regained a top-three position domestically and other businesses are profitable, they still cannot survive and rely on the Chinese people to continue buying Huawei products.”