Telecommunications equipment and services giant, Huawei, announced yesterday that based on its unaudited annual report, its worldwide revenue for 2013 would be between 238-240 billion yuan (U.S. $ 39 billion) which is an increase of 8% over the last year.
It also estimated that its operating profits for the year would be between 28.6-29.4 billion yuan (U.S. $ 4.6 billion), a jump of 40% in 2013.
According to Huawei's Chief Financial Officer, Meng Wanzhou (Cathy Meng), the rise in revenue and profits is attributable to rapid growth in the company's consumer and corporate businesses, saving gained by streamlining the management structure and its investment in innovation.
Meng, who is also the daughter of Huawei founder Ren Zhengfei, said that in 2013 Huawei increased its investment in research and development by nearly 33 billion yuan (US$ 5.5 billion) or almost 14% of its sales revenue. Much of the investment was made in 4G technology which is being aggressively deployed in China and creates business opportunities for companies like Huawei that are ahead of the curve.
Huawei will continue to invest heavily in research and development with Meng saying that it plans to invest U.S. $ 600 million (3.6 billion yuan) over the next four years into upcoming 5G technologies.
With consumer and corporate sales expected to rise over the medium term, Meng said she expects revenue to continue growing 10% annually over the next five years. Sales increased in all three of Huawei's main divisions with corporate sales growing 32%, consumer sales growing 17%, and sales in its networking equipment business growing 5%. Meng explained that while sales growth in Huawei's networking equipment business was decidedly lower than its other business, it still accounted for a major portion of the company's overall profits and most of the sales were made to the world's top 50 telecom companies.
Huawei ranks as the second largest telecom equipment maker in the world.