Huawei’s rotating CEO Xu Zhijun revealed in his 2017 New Year’s speech that Huawei’s sales revenue is expected to reach RMB520 billion in 2016, a year-on-year increase of 32%. What does this number mean?
Compared with others, in terms of sales revenue, 520 billion is roughly equivalent to 1.5 Lenovo, 5 Gree Electric Appliances, 5 ZTE, 5 Alibaba, 6 BYD, 6.5 millet; more than the sum of BAT; about equal to Wanda + Vanke; the top 500 in the world's top 500.
Compared with Huawei, 520 billion is equivalent to 2.36 times of 2012 sales revenue of 220.2 billion yuan. As a billion-dollar enterprise, Huawei has more than doubled in five years.
In terms of revenue composition, according to Huawei's past five-year annual report, about 60% of Huawei's revenue comes from overseas. According to this calculation, in 2016, Huawei generated about 312 billion yuan in overseas revenue.
In 2016, China’s economy was sluggish and the global economy was sluggish. Huawei created a performance myth. As the founder and head of Huawei, is Ren Zhengfei a god?
In the flowers and applause, Ren Zhengfei is like a thin ice. 2017 is the 30th year of Huawei's establishment. "Thirty years of Hedong, thirty years of Hexi, our 30-year limit is coming. Huawei wants to be born without thinking of death, our organization, structure, talents... everything must change." Ren Zhengfei said.
"Huawei can earn tens of billions if you take advantage of one opportunity, but if we are trapped in short-term interests, we will lose time and lose strategic opportunities in non-strategic opportunities." At the end of 2015, Ren Zhengfei was a professor at Renmin University of China. In an interview with Peng Jianfeng, the leader of the drafting team of the Huawei Basic Law, Huawei has only done one thing for many years, that is, insisting on the “pipeline strategyâ€. Ren Zhengfei compared the communication network pipeline to the Pacific Ocean, the Yellow River and the Yangtze River; the enterprise network is the urban water pipe network; the terminal is the faucet. "Along this integration, all are pipes, which are useful to Huawei."
In 2016, the operator business, corporate business and consumer business jointly supported Huawei's 520 billion sales revenue.
The carrier business is the starting point of Huawei. In summing up the 2016 record, Huawei’s rotating CEO Xu Zhijun said that in 2016, while continuing to strengthen network products and services, the operator’s business will focus on video, cloud and operational transformation, and expand the industry and promote the industry. Development, while maintaining high growth, operational asset efficiency has also improved.
In 2016, it was called "4.5G commercial first year". There are more than 90 commercial/pre-commercial networks in the world, of which 55 are deployed by Huawei. At present, Huawei has invested heavily in the layout of 5G networks.
2016 is also considered to be the “first year of video outbreakâ€, and the video business has become a strategic business for operators. In September 2016, Ren Zhengfei signed an agreement between Huawei and Leica to establish Max Berek Innovation Lab. He predicts that more than 90% of the traffic in the future information society will come from images and videos.
In another major segment, the corporate business, Xu Zhijun said that in 2016, through close collaboration with global partners, we will provide innovative solutions for the digital transformation of enterprises, help customers cope with the challenges of digital transformation, and build a cooperative and win-win ecosystem. To achieve sustained and effective growth in key industries such as smart cities, energy, finance, transportation, and manufacturing.
In 2016, Huawei's consumer business also achieved a key breakthrough for the global high-end smartphone market.
"Huawei is not a listed company, it is not bound by the capital market and kidnapped. We can 'stupidly invest in ideals and goals, so we can reject short-sightedness and opportunism, and only seize strategic opportunities. Non-strategic opportunities or short-term money-sharing opportunities can be abandoned. This is something that capital and shareholders can't do." Ren Zhengfei said in an interview with Peng Jianfeng.
Some analysts pointed out that it is precisely because Huawei has gone "a bitterer road than others" for many years, focusing on research and development, adhering to "technology is king", and not doing a short and fast, has achieved today's results.
Mobile phone business becomes a "hematopoietic weapon"In the mobile phone business, Huawei has become a blood-making weapon for sales revenue from the initial edge of OEM production and profit margins. Huawei's consumer business CEO Yu Chengdong announced in the 2017 New Year's speech that in 2016, Huawei's consumer business sales revenue is expected to reach RMB 178 billion, a year-on-year increase of 42%. Consumer business has accounted for 34.2% of Huawei's total sales revenue.
According to IDC, the smartphone industry is growing slowly, with annual global shipment growth of about 1%. Huawei's annual shipments are expected to reach 139 million units, an overall increase of 29%. Huawei is the third largest mobile phone company in the world after Apple and Samsung, and the first smartphone manufacturer in China with annual shipments of over 100 million. On January 13, 2016, Ren Zhengfei pointed out at the Huawei Market Work Conference that Huawei terminals should dare to exceed the goal of 100 billion US dollars in revenue within five years.
The $100 billion is equivalent to recreating a Huawei, which was unimaginable five years ago. “When the Huawei brand started its business five years ago, we set a challenge target: 'We want to sell 1 million high-end smartphones with Huawei LOGO. 'Everyone thinks incredible.†Yu Chengdong recalls.
In November 2011, Huawei held the “Sanya Conferenceâ€. Ren Zhengfei explicitly proposed to treat the final consumer as a corporate customer. This decision changed Huawei's mobile phone R&D and sales model. By the end of 2012, Huawei has realized the transition from OEM customization to its own brand.
In an internal speech in 2014, Ren Zhengfei warned Yu Chengdong: "A mobile phone earns 30 yuan. What kind of high-tech, high-level? Is it a lot of dollars to earn hundreds of millions of dollars now? Take your longboard to go to others. The short board is also complacent." Ren Zhengfei said that the performance of Huawei's mobile phones should be profit-oriented rather than sales revenue.
Since then, Huawei's mobile phone has decided to break away from the price war, relying on research and development to take the high-end market and enhance the brand's premium ability. In December 2016, after 8 months of listing, Huawei P9/P9 Plus shipped more than 10 million units worldwide, becoming Huawei's first high-end flagship smartphone with tens of millions of shipments.
2000 R&D cadres re-enterAt the National Science and Technology Innovation Conference held in May 2016, Ren Zhengfei proposed to increase the sales scale to 150 billion US dollars (about 1 trillion yuan) in 2020.
This is equivalent to doubling the current size. For Huawei, it will be a battle. On the evening of October 28th, 2016, Huawei held a “Recruiting the Future†R&D officers at the Shenzhen Headquarters to announce that 2,000 Huawei senior R&D personnel and experts will travel to Europe, Southeast Asia, the Middle East, the Americas, Africa and other places. Collaborate with the first-line market team to tap the market.
Ren Zhengfei spoke at the expo conference with the title "Spring River Plumbing Duck Prophet, Don't Break the Loulan Oath". “In the current era of digitalization and network transformation, we have assembled 2,000 senior experts and cadres from the R&D team and went to the battlefield to combine with tens of thousands of front-line soldiers who are familiar with the scene to form a stream of iron. The time of opening, rushing, tearing it apart, vertical development, horizontal expansion." "We missed the voice age, the data age, the strategic highlands of the world we did not occupy, we can not miss the image era."
He also recalled the scene when Huawei first went abroad in 2000. "In 2000, Wuzhou Hotel went to the taxi meeting. We slogan "The burial of the bones everywhere, why the horses are covered with corpses" is full of a tragic, in fact, we At that time, there was no even a horse." The record of the expedition is that, as of now, Huawei has more than 170,000 employees and operates in more than 170 countries and regions around the world, serving more than one-third of the world's population.
Looking ahead, the uncertainty of the global political economy is increasing, and the ICT industry is in transition. For Huawei, to achieve the next leap, "an urgent need for more experts and generals to build a more solid defense line against future complex networks."
"Through this crisis, after completing this reform, Huawei can truly stand up in the world." Ren Zhengfei said.
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