Huawei Investment & Holding Co., Ltd.
2022 Annual Report
A challenging external environment and non-market factors continue to take a toll on Huawei's operations. In the midst of this storm, we have kept racing ahead, doing everything in our power to maintain business continuity and serve our customers. We have also gone to great lengths to grow the harvest – generating a steady stream of revenue to sustain our survival and lay the groundwork for future development.
Eric Xu, Rotating Chairman
In 2023, we will continue to maintain strategic focus and strengthen R&D investment. Working with our global partners, we will focus on creating greater value for our customers, partners, and society as we continue to prime the pump for sustainable survival.
Liang Hua, Chairman of the Board
Financial Performance
In 2022, our operating results were in line with forecasts
Five-Year Financial Highlights
| 2022 | 2021 | 2020 | 2019 | 2018 | ||
|---|---|---|---|---|---|---|
| (USD Million) | (CNY Million) | (CNY Million) | ||||
| Revenue | 92,379 | 642,338 | 636,807 | 891,368 | 858,833 | 721,202 |
| Operating profit | 6,071 | 42,216 | 121,412 | 72,501 | 77,835 | 73,287 |
| Operating margin | 6.6% | 6.6% | 19.1% | 8.1% | 9.1% | 10.2% |
| Net profit | 5,114 | 35,562 | 113,718 | 64,649 | 62,656 | 59,345 |
| Cash flow from operating activities | 2,560 | 17,797 | 59,670 | 35,218 | 91,384 | 74,659 |
| Cash and short-term investments | 53,709 | 373,452 | 416,334 | 357,366 | 371,040 | 265,857 |
| Working capital | 49,608 | 344,938 | 376,923 | 299,062 | 257,638 | 170,864 |
| Total assets | 152,993 | 1,063,804 | 982,971 | 876,854 | 858,661 | 665,792 |
| Total borrowings | 28,353 | 197,144 | 175,100 | 141,811 | 112,162 | 69,941 |
| Equity | 62,859 | 437,076 | 414,652 | 330,408 | 295,537 | 233,065 |
| Liability ratio | 58.9% | 58.9% | 57.8% | 62.3% | 65.6% | 65.0% |
| Note: Converted into United States dollars (“USD”) using the closing rate at the end of 2022 of USD1.00 = CNY6.9533. | ||||||
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By Customer Group
| (CNY Million) | 2022 | 2021 | YoY |
|---|---|---|---|
| Carrier Business | 283,978 | 281,469 | 0.9% |
| Enterprise Business | 133,151 | 102,444 | 30.0% |
| Consumer Business | 214,463 | 243,431 | (11.9)% |
| Other | 10,746 | 9,463 | 13.6% |
| Total | 642,338 | 636,807 | 0.9% |
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By Industry
| (CNY Million) | 2022 | |||||
|---|---|---|---|---|---|---|
| ICT Infrastructure | 353,978 | |||||
| Consumer | 214,463 | |||||
| Cloud Computing | 45,342 | |||||
| Digital Power | 50,806 | |||||
| Intelligent Automotive Solutions | 2,077 | |||||
| Other | 3,978 | |||||
| Elimination | (28,306) | |||||
| Total | 642,338 | |||||
| Note: In line with the changes of the corporate business management architecture, we disclosed the revenue breakdown by industry in 2022. | ||||||
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By Region
| (CNY Million) | 2022 | 2021 | YoY |
|---|---|---|---|
| China | 403,999 | 413,299 | (2.3)% |
| EMEA | 149,206 | 131,467 | 13.5% |
| Asia Pacific | 48,048 | 53,675 | (10.5)% |
| Americas | 31,898 | 29,225 | 9.1% |
| Other | 9,187 | 9,141 | 0.5% |
| Total | 642,338 | 636,807 | 0.9% |
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Research and Innovation
Every year, Huawei invests over 10% of its sales revenue into R&D
977.3 billion
Total R&D investment over the last decade now exceeds CNY977.3 billion
25.1%
In 2022, our total R&D spending was CNY161.5 billion, representing 25.1% of total revenue
55.4%
At the end of 2022, 114,000+ employees, or 55.4% of our workforce, worked in R&D
120,000+
By the end of 2022, Huawei held a total of 120,000+ active patents
Business Highlights
Driving Ubiquitous Connectivity
- We have worked with carriers and partners worldwide to accelerate digital transformation and facilitate customers' business success in the 5G era. At the end of 2022, the number of 5G users across the globe exceeded one billion. 5G networks built by Huawei continue to deliver leading experiences. Huawei has also worked with industry partners to define 5.5G and drive the connectivity industry forward.
- We help carriers build cutting-edge all-optical networks that offer ultra-high bandwidth, ultra-low latency, and high reliability, realizing fiber to everywhere and OTN to every site. At the 2022 Broadband World Forum, Huawei's SingleFAN Pro solution won the Outstanding FTTH Solution Award.
- In remote rural areas, Huawei's RuralLink solution simplifies network deployment by eliminating the need for equipment rooms, fiber cables, and mains power. We are committed to collaborating with carriers and industry partners to connect the unconnected and bring the benefits of mobile broadband to everyone.
Enabling Pervasive Intelligence
- We are committed to accelerating the digital and intelligent transformation of industries by developing the computing industry around Kunpeng and Ascend. Kunpeng features general-purpose computing capabilities while Ascend targets AI computing capabilities. We work with our partners to drive the computing industry forward and foster a vibrant ecosystem. To date, more than 5,200 partners and 3.1 million developers have joined the Kunpeng and Ascend ecosystems, and more than 14,000 solutions have been certified.
- Huawei Cloud has launched DevCloud, which integrates the capabilities of the ModelArts AI development pipeline, the MetaStudio digital content production pipeline, the DataArts data governance pipeline, and the CodeArts software development pipeline. Together, these pipelines support collaborative development and on-demand orchestration of AI models, data, digital content, and applications. They facilitate more efficient collaboration between teams and enable agile development of intelligent applications.
- As part of Huawei's broader "Platform + Ecosystem" strategy, we are creating a digital foundation and development tools that can be used in the development of intelligent vehicles. We have brought together more than 300 partners from across the automotive industry through three ecosystem platforms: intelligent digital vehicle platform (iDVP), intelligent driving computing platform, and HarmonyOS Intelligent Cockpit platform.
Delivering a Personalized Experience
- HarmonyOS has already been deployed on 330 million Huawei devices. HarmonyOS 3 was officially launched in 2022, representing a full expansion of the Super Device feature, which is now available on 12 different device types, including smartphones, tablets, PCs, HUAWEI Vision products, earphones, smart watches, and head units, facilitating effortless cross-device interactions.
- The HarmonyOS ecosystem continues to grow by leaps and bounds. HarmonyOS Connect, the technology brand that supports the HarmonyOS ecosystem, has attracted more than 2,300 ecosystem partners and continues to add more product categories. In 2022 alone, over 181 million new devices in the HarmonyOS Connect ecosystem were shipped, covering numerous types of smart home appliances. By the end of 2022, the number of feature abilities (FAs) running on HarmonyOS-powered devices exceeded 50,000.
- Our intelligent cockpit and intelligent driving solutions have won multiple prestigious industry awards and set new industry benchmarks. Our intelligent cockpit solution, for example, won two awards at the World Intelligent Driving Challenge: Top Intelligent Cockpit Award and Extreme Challenge Award. All AITO models come equipped with HarmonyOS Intelligent Cockpit, which has been deemed one of the best head units on the market by the industry and consumers for its intuitive, intelligent, and convenient cockpit experience.
Building a Digital Platform
- We have worked with customers and partners worldwide in a bid to deeply integrate ICT technology into industries and accelerate industry digitalization. To date, we have developed more than 100 scenario-based solutions. We have also established business units (BUs) that focus on specific industries, such as the Mine BU, Smart Road, Waterway & Port BU, Government Public Services Digitalization BU, Electric Power Digitalization BU, Digital Finance BU, and Aviation & Rail BU, to rapidly respond to customer needs together with partner products and capabilities.
- Huawei Cloud continues working to provide Everything as a Service, including Infrastructure as a Service, Technology as a Service, and Expertise as a Service, aiming to help our customers unleash the power of digital faster. Huawei Cloud was recognized in Gartner's 2022 Magic Quadrant for Cloud Infrastructure & Platform Services (CIPS). The number of Huawei Cloud developers globally now exceeds 4 million.
- We have launched multiple programs like the Huawei Cloud Partner Competency Program, the Kunpeng Partner Program, and the openEuler Partner Program to encourage innovation among partners. We have also worked with more than 43,000 ecosystem partners and released over 10,000 products on KooGallery, in addition to certifying more than 12,000 Kunpeng application software solutions and over 2,000 innovative Ascend solutions. These solutions and services are currently deployed in a number of core industries including government, finance, energy, transportation, manufacturing, healthcare, and education.
Ecosystems
Huawei works with ecosystem partners, developers, and universities to help industries go digital and build thriving ecosystems
We focus on developing platform capabilities for our ecosystem-centric businesses like HarmonyOS, Kunpeng, Ascend, cloud computing, and intelligent automotive solutions. We also openly collaborate with a wide range of partners to develop business ecosystems that thrive on shared success. Together, we aim to unleash ecosystem-based innovation and create greater value for our customers while achieving shared success with ecosystem partners and developers.
Enabling ecosystem partners on all fronts, working together to drive shared success, and creating greater value for our customers
We have launched multiple programs like the Huawei Cloud Partner Competency Program, the Kunpeng Partner Program, and the openEuler Partner Program to encourage innovation among partners. By the end of 2022, we have worked with more than 43,000 ecosystem partners, released over 10,000 products on KooGallery, and have certified more than 12,000 Kunpeng application software solutions, over 2,000 innovative Ascend solutions, and 50,000 feature abilities (FAs) for HarmonyOS. Together with our partners, we currently serve more than 20 core industries, including government, finance, energy, transportation, manufacturing, healthcare, and education.
Huawei actively advocates for co-creation, sharing progress, and sharing success. We continue to expand access to more technologies, enrich toolchains, share industry experience, and increase funding for developers. These efforts aim to improve developer experience and support them in hardware and software design, development, testing, release, and operations, ultimately paving the way for greater success. As of the end of 2022, we serve and support about nine million developers.
In 2022, we invested CNY1.94 billion to support developer innovation through programs like the Huawei Cloud Developer Program, the OpenMind Program, and the Shining-Star Program. In the same year, we provided 3.65 million training opportunities to developers both online and offline, and issued Huawei technical certifications to 220,000 developers.
Developing a robust digital talent ecosystem, sharing ICT knowledge and skills, and helping universities cultivate digital talent
Huawei has launched a variety of programs, including the Huawei Cloud Developer Program (for universities), the Harmony 100 School Seeds Program, the Business-Academia Talent Development Program, and the Talent Development Acceleration Program. We also sponsor various programs like talent cultivation and competitions in colleges and universities. Over the past three years, these programs have benefited over 600,000 students and 6,000 teachers from 370 universities, and we will continue to expand these efforts moving forward.
Cyber Security and Privacy Protection
Challenges and Opportunities
As the world grows more interconnected, digital, and intelligent, cyberspace is becoming an integral part of life, business, and the economy. While digital technologies like cloud computing, big data, artificial intelligence (AI), and 5G are creating unprecedented new value for society, the world is also growing increasingly vulnerable. As digital assets increase, attack surfaces are continuing to expand, security vulnerabilities are being exploited more frequently, and cyberspace as a whole is becoming increasingly unsecure. These are making cyber security assurance more important than ever.
We must continuously improve cyber security to safeguard the development of our digital economy, which entails both challenges and opportunities. That means building digital trust and making critical infrastructure both more secure and more resilient. That means guiding enterprises through the digital transformation process, implementing management and technical measures to control risks, ensuring compliance, and protecting both networks and data. Overall cyber security and privacy protection is about dealing with the daily details of good practice. It is not always exciting, but it does keep the world moving forward in a positive way.
Over the past 30-plus years, we have worked with carriers to build over 1,500 networks and have helped millions of enterprises go digital. During this time, we have connected over three billion people around the world and maintained a solid track record in security throughout. As digital transformation picks up speed, we are acutely aware that cyber security and privacy protection will become key to business success in the future digital world.
With this in mind, we have continued to make cyber security and privacy protection a top priority. We are committed to confronting cyber security and privacy challenges and seizing related opportunities through management transformation, technological innovation, and open collaboration. We are committed to fostering a better life for all in the future digital world where personal data is lawfully used and always protected by offering secure and trustworthy products, solutions, and services.
