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Abu Dhabi, UAEWednesday 14 November 2018

Exclusive: Huawei targets 20% increase in smartphone revenues next year

Chinese smartphone giant is on track to ship 200 million phones this year

Kevin Ho, president of the handset product line at Huawei consumer business group, is sure of increasing global market share. Alkesh Sharma / The National
Kevin Ho, president of the handset product line at Huawei consumer business group, is sure of increasing global market share. Alkesh Sharma / The National

The world's second largest smartphone manufacturer Huawei, which launched its new Mate 20 Series in London on Tuesday, expects revenue from smartphones to increase by double-digits in 2019 while it massively increases the number of global shipments.

“In the smartphones segment, we are looking forward to increasing the sales revenue by at least 20 per cent in 2019 compared with this year. Our new Mate 20 Series is going to facilitate this,” Kevin Ho, president of the handset product line at Huawei consumer business group, told The National.

Last year, Huawei shipped nearly 153 million handsets worldwide. By the end of this year, it is on track to deliver 200 million units, a boost of almost 30 per cent with growth targeted mainly in Europe and China, Mr Ho said.

The smartphone giant generated 325.7 billion Chinese yuan (Dh172.6bn) in revenue globally in the first half of 2018, an increase of 15 per cent over the same period last year. The company's operating margin was 14 per cent during the first half of this year.

In the Mena region, the Chinese company's shipments grew 76 per cent year-on-year in the first half of 2018, while revenue surged 100 per cent.

Shenzhen-headquartered Huawei is looking to capitalise on the the roll-out of 5G, the fifth generation of mobile communications which is expected to virtually eliminate any lag time between mobile providers and networks, opening up such futuristic possibilities as real-time chat in virtual reality, high-definition footage from drones and remote surgery while using less energy at less cost.

“We already have the roadmap for a 5G smartphone. Next year many carriers are expected to build 5G networks and we will provide test models (5G-enabled devices) to our key partners by next year,” stated Mr Ho.

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Adding to the speculation around foldable smartphones (think of a folding smartphone screen, not a flip phone), Mr Ho said that the company is working on them.

“We are working on foldable technology…. and probably we will announce our new products next year, but nothing is confirmed yet,” Mr Ho said.

Huawei’s arch rival Samsung is also in the race to launch foldable smartphone technology in the coming months.

Huawei is spending liberally on research and development to stay competitive.

“Every year, we have a target of investing at least than 10 per cent of our revenues on R&D. In fact, last year, we invested more than 15 per cent of our revenue.”

Huawei unveiled its much-awaited Mate 20 Series on Tuesday, offering larger screens and better cameras. Available in 6.53-inch, 6.39-inch and 7.2-inch sizes, the Huawei Mate 20 Series has four devices: Mate 20, Mate 20 Pro, Mate 20 X and Mate 20 RS that cost between €799 and €2095.

Sales for Huawei overtook US smartphone giant Apple in the second quarter of 2018 to become the no 2 smartphone vendor globally for the first time, just behind Korea’s Samsung, according to Massachusetts-based research firm International Data Corporation.

In response to the question of if Huawei is looking to dethrone Samsung from the top position, Mr Ho said, “Maybe next year.”

In the United States and Australia, though, Huawei is facing accusations from lawmakers and intelligence officials who say its products are used for Chinese espionage, an allegation the company has denied.

Mr Ho declined to comment on the impact of these allegations on the business.