On Wednesday (March 31), Huawei held an online conference saying that cash flow from operating activities in 2020 was down 61.5% to $35.2 billion, the lowest level since 2013. That brought its operating cash flow margin down to 3.95 percent.
In 2019, former U.S. President Donald Trump blacklisted Huawei from exporting key U.S.-origin technologies, affecting its ability to design its own chips and source key components from outside suppliers.
In 2020, the U.S. cut off Huawei’s supply of key chips again, dealing a second blow to its cell phone business. Huawei was ranked second in the world in terms of market share when it was added to the list of U.S. entities, but by the fourth quarter of 2020, Huawei’s global market share had fallen out of the top five positions, according to the report.
Trump’s ban has put Huawei’s mobile business under immense pressure, and the company sold its Pride smartphone business to a consortium of agents and resellers in November 2020 to keep it afloat.
The U.S. has urged countries to exclude Chinese suppliers in critical infrastructure for national security reasons. As a result, Huawei has been shut out of the 5G market by an increasing number of countries.
2020 is the first year that Huawei has been affected by US sanctions. Huawei’s annual report showed that its revenue in the Americas fell by a quarter, in Europe, the Middle East and Africa by 12 percent, and in Asia Pacific by 9 percent, while sales in China grew by 15 percent. Overall revenue in China accounted for more than 65 percent of the group’s revenue.
The Financial Times reported that Huawei’s image as a global company is reversing.
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