Huawei Warns Trump's Ban Might Wipe Out $30 Billion of Sales Growth
Huawei founder Ren Zhengfei expects U.S. sanctions to curtail its revenue by about $30 billion over the coming two years, according to Bloomberg.
Sales at China’s largest technology company will likely remain stagnant at about $100 billion in 2019 and 2020, the billionaire said during a panel discussion. Huawei however will aim to maintain its research and development budget and refrain from layoffs or major asset sales. The sale of a majority slice in Huawei Marine was a business decision that was unrelated to America’s campaign against the company, the 74-year-old CEO added.
Ren said he was surprised at the extent to which Washington has attacked his corporation. Huawei is said to be preparing for a fall of as much as 60% in overseas smartphone shipments, as Google cuts it off from Android updates and apps from Gmail to Maps. The founder has conceded that Trump administration curbs will cut into a two-year lead it’s painstakingly built over rivals like Ericsson and Nokia.
“We didn’t expect the U.S. would so resolutely attack Huawei. We didn’t expect the U.S. would hit our supply chain in such a wide way, not only blocking the component supplies, but also our participation in international organizations,” Ren told the panel in a broadcast from Huawei’s home city of Shenzhen. “That will make our revenue for this and next year around $100 billion.”
“We didn’t expect the damage to be this serious. We did make some preparations, like the damaged plane I talked about. We only protected the engine and fuel tanks, but failed to protect other parts,” he told author-investor George Gilder and MIT Media Lab founder Nicholas Negroponte, who both agreed the U.S. was making a mistake in singling Huawei out. “We will be reborn by 2021,” Ren said.