Huawei’s profit increased due to taking stake from Apple and Alibaba

(Bloomberg) — Huawei Technologies Co. posted strong quarterly profit growth on the back of the resurgence of its consumer business against Apple Inc.’s iPhone and the rise of its cloud division against incumbent Alibaba Group Holding Ltd.

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The Chinese networking and electronics leader reported a net profit of about 13.9 billion yuan ($1.9 billion) in the December quarter, based on Bloomberg calculations of financial data. This is up 65% from 8.4 billion yuan a year earlier.

The results highlight how Huawei, which has been the target of US sanctions and export controls for years, has made progress in dealing with the challenges. In August, the company unveiled its flagship Mate 60 smartphone lineup with a domestically designed and produced 7-nanometer processor, sparking a wave of nationalistic popularity domestically. Its consumer electronics division is expected to grow 17.3% in 2023, with sales of 251.5 billion yuan.

Huawei, which was almost cut off from smartphone and chipmaking after the US cut off foreign suppliers in 2019, is emerging as a symbol of China’s determination to circumvent Washington’s sanctions. It is now building a network of chip-making plants to meet its long-term ambitions in areas such as electric vehicles and artificial intelligence.

The company’s cloud computing arm grew nearly 22% during the year, as it stepped up competition domestically with Alibaba and Tencent Holdings Ltd. This month, the firm deployed an artificial intelligence-powered weather forecasting model with the meteorological bureau of its home city of Shenzhen. The company’s chips are also appearing in systems from Chinese AI developers, such as the Hong Kong-based Center for…

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