(Bloomberg) — Huawei Technologies Co. posted its first quarterly net loss in years after the company spent aggressively on research in areas from EVs to chips while the business as a whole slowed.
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The Shenzhen-based networking and electronics leader reported a 9.5% rise in revenue to about 276 billion yuan ($38.1 billion) in the December quarter, according to Bloomberg’s calculations based on annual results. That follows a string of double-digit increases, fueled by the growing popularity of its Mate devices at the expense of Apple Inc (AAPL).
Huawei took a big step forward in chipmaking and smartphones last year, when it debuted its own fully in-house operating system and began to compete with Nvidia Corp. (NVDA) domestically on AI server chips. Hit by a series of US sanctions, Huawei spent heavily on research and development, including on newer ventures such as EV software.
It posted a net loss of about 300 million yuan for the past quarter, compared with a net profit of 13.9 billion yuan a year ago when the company recorded gains from previous asset sales. It sold Honor Device Co. in 2020 and parts of its server arm in 2021. Huawei said it plowed 179.7 billion yuan into R&D last year, up 9.1% from 2023 and about a fifth of overall revenue.
Still, the business of smart driving solutions for carmakers became profitable for the first time last year, helped by the rapid adoption of electric vehicles across China. Revenue more than quintupled.
The consumer business group, which encompass handsets, wearables and laptops, grew 38% in 2024. Huawei devices experienced 20%-plus growth in the Chinese smartphone market in the past quarter, when Apple saw a decline, according to industry consultancy IDC.
The cloud computing arm grew 8.5% in 2024 as demand for AI powered growth across China post-DeepSeek. Huawei has benefited as Chinese buyers can’t get advanced Nvidia GPUs under US sanctions. The Jack Ma-backed Ant Group Co. used Chinese-made semiconductors including Huawei’s to train its models, Bloomberg reported this month.
The core telecom business — the oldest division and the foundation of Huawei’s global growth — grew 5% last year. The US is ratcheting up pressure on European carriers to stop doing business with Huawei.
