Chinese telecommunications giant Huawei reported financial results in the first quarter of this year. It turned out that the company’s financial income decreased by approximately 14% compared to the same period last year, and profits fell by more than half.

Image Source: Huawei

According to a Huawei spokesperson, the consumer goods business has been hit hard as the information technology and communications infrastructure projects continue to grow steadily. Overall, a challenging business environment remains in 2022.

The company reported first-quarter 2022 revenue of $20.63 billion, down 13.9% from the same period last year and more than 27% down from the fourth quarter. Yield in the first three months was 4.3%, more than doubling from 11.1% a year earlier. Huawei claims that the results are in line with the company’s expectations and the Chinese tech giant, in contrast , increased investment in research and development.

The Chinese manufacturer’s smartphone business has been hardest hit by U.S. sanctions imposed on Huawei under President Donald Trump, severely limiting its ability to buy and order components like the most recent chips.

Overall, smartphone sales in China fell 14% from the first quarter of last year, according to Counterpoint Research. However, Huawei showed the worst result. The company ranks sixth in terms of market share in the country, and its smartphone sales are down 64.2% year-on-year and 12% quarter-on-quarter.

Image Source: Huawei

Another “loser”, whose sales in China fell by 23% compared to the last quarter, was Apple. However, compared to the first three months of last year, the company’s smartphone sales still grew by 4.4%.

To compensate for the drop in smartphone sales, Huawei began to actively search for talented personnel and develop new industries for itself. While the developer hasn’t gone into EV production on its own, the company is actively promoting its Harmony OS operating system and other technologies to Chinese car brands. According to the latest data, at least two more models of machines using Huawei technologies will be released this year. The first model with Harmony OS was the Aito M5 , which has already started shipping.

According to Huawei, the R&D team for smart car technology has recently grown to 5,000 people, and the company’s investment in vehicle-related technology reached $1 billion last year.