Broadening horizons: Huawei looking forward amid US bans

In building its own ecosystem and attempting to lure developers to the table, Huawei is building a contingency strategy in case of further global tensions.

It's no exaggeration to suggest that Huawei has done quite a remarkable job in managing the implications presented by its placement on the US Government's ‘Entity List'. While being all but excluded from the world's largest economy, as a tech company, would cripple just about any global company, Huawei has managed to keep its head above water, shifting focus towards its consumer products, its highly lucrative domestic business, and forging carrier contracts in countries without hardline affiliations to the United States.

All of this culminated in a relatively impressive financial report for 2018, in which the company recorded 19.5% revenue growth to $107 billion, despite the troubles it is experiencing globally. This seemingly continued in its H1 results for 2019, where it recorded 23.2% YoY growth. However, some pundits were quick to point out that the company experienced no growth in its smartphone shipments (which have been its biggest growth point of late) quarter-to-quarter (Q1 to Q2), which is a point of difference as it historically has performed considerably better in Q2.

While any growth in smartphone shipments—as a Huawei spokesperson pointed out--‘bucks the industry trend', the company is undoubtedly feeling the heat, as it has expected. The company's founder Ren Zhengfei predicted earlier in the year that the bans would cost the company around (USD) $30 billion, although he downplayed this figure a few days later.

Regardless, the company has needed to be fairly dynamic in dealing with this issue, almost to the point that it has to incorporate a refreshed ideology at every level of its business. One could argue that this was evident at Huawei's ‘Connect' conference this year, which IDG Connect was fortunate enough to attend. While the event was focused around ‘Advanced Intelligence', a significant part of this was the company's major investment in computing products, rather than focusing on telecommunications/5G infrastructure.

Computing, Huawei says, represents a massive opportunity for investment, and will serve to drive the innovations forged through 5G and AI. This isn't the only way Huawei is attempting to ensure its business options remain open though, as the company also used the event to align themselves further with open source tech and lure a wealth of developer talent over to its platforms and ecosystem. The aim of it all is undoubtedly to create an insurance policy that shields them the US aftermath and establish a long-term contingency strategy in case tensions never ease.

Computing power: where are they investing?

As Ken Hu mentioned in his opening keynote, Huawei has been increasing its investment in computational technology over a period of 10 years, and this new foray into the computing market is not exactly a brand-new venture for the company. However, at ‘Connect', Huawei massively upped their focus on the computing market, as it's see as inextricably linked to the success of AI-driven innovation. Its computing products, in this sense, are mostly centered around AI processing.

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