Huawei, the Chinese tech giant, is in the midst of one of the most remarkable comebacks in the history of the tech industry. Once severely hampered by U.S. sanctions, the company has not only rebounded but is also breaking new ground across multiple sectors.
The company’s in-house operating system, Harmony OS, now powers over 900 million smartphones. “We have done in 10 years what our European and American counterparts have done in more than 30 years, and have achieved independent control of the core technology of the operating system,” Richard Yu, chairman of Huawei’s consumer business group, announced at a developer forum on Friday.
The story of Harmony OS, known as “Hongmeng” in Chinese, began in 2019. It was unveiled shortly after Huawei was placed on a U.S. trade blacklist, preventing American firms from selling technology and software to the company without a license. The ban, based on national security concerns, severely impacted Huawei’s ability to use Google’s Android OS, leading many to predict the downfall of its smartphone business.
Despite these challenges, Huawei has made a significant turnaround. The company’s flagship smartphone sales surged 72% in the first five months of 2024 compared to the same period the previous year, highlighting its resurgence in the smartphone market. The Mate 60 Pro, in particular, garnered attention for its advanced processor, surprising industry experts given the U.S. restrictions on chip technology.
Huawei’s ambitions extend beyond smartphones. Last year, the company launched an electric sedan to compete with Tesla’s Model S, signaling its entry into the electric vehicle market. Additionally, Huawei is making significant strides in artificial intelligence (AI). Nvidia, one of the world’s most valuable companies, recently recognized Huawei as a top competitor in processor production for AI systems.
Yu emphasized Huawei’s competitive edge in AI, stating that the company’s Ascend processors are 1.1 times more effective in training large language models compared to mainstream international offerings. Although he did not specify competitors, this claim underscores Huawei’s growing prowess in AI technology.
Financially, Huawei is thriving. The company’s net profit soared 564% to $2.71 billion in the first quarter of 2024. This impressive performance follows its fastest revenue growth in four years in 2023, driven by a resurgence in its consumer segment and new ventures like smart car components.
Huawei’s resurgence has also impacted its competitors, particularly Apple. According to Counterpoint Research, Apple, which led China’s smartphone market with nearly a 20% share in the first quarter of 2023, fell to third place in the first three months of 2024, with its market share dropping to 15.7%. In contrast, Huawei’s market share jumped from 9.3% in 2023 to 15.5% in 2024.
Huawei’s comeback is a testament to its resilience and innovation. The company has navigated significant obstacles, including severe U.S. sanctions, to reclaim its position in the tech industry. By expanding into new markets and developing cutting-edge technologies, Huawei continues to demonstrate its ability to adapt and thrive in a challenging global environment.
As Huawei continues its journey, the tech world will be watching closely. Its success not only reshapes the competitive landscape but also highlights the dynamic and ever-evolving nature of the tech industry.