Huawei had a 69 percent drop in sales due to US restrictions.

The restrictions of different international markets complicated its production and sale. However, the company said that it is only a crisis.

Despite the fact that there was a season in which the Chinese technology giant managed to surpass the sales of Samsung and Apple, the company today faces a complex economic situation due to the restrictions it has received from different countriesreported Portfolio.

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In accordance with Meng Wanzhouvice chair of the board and chief financial officer of the company, in 2022 profits were reduced by 69 percent due to the blockade of large marketsamong them “the sanctions by the United States in the 5G technology business and in the access to microcomponents”.

“In 2022, the challenging external environment and non-market factors took their toll on Huawei’s operations,” said Eric Xu, former president of the company, quoted by the same media.

In addition, the situation was not encouraging for the brand when the restrictions of the North American country were also adopted by Australia, Canada, Japan, the United Kingdom and Sweden.

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Why Huawei has lost part of its profits

Similarly, the portal pointed out that in the last 3 years there was a increase in cost and scarcity of components to manufacture technology, disruptions in the supply chain and the restrictions derived from the pandemic also affected.

For example, in the government of Donald Trump, 5G technology was banned from Huawei due to “suspicions that the firm was cooperating with the Chinese Communist Party in intelligence and surveillance tasks“. and the government of Joe Biden extended the sanctions on the Chinese company cwhen he added it to the “entity list” of the US Department of Commerce’s Bureau of Industry and Security.

“Any company anywhere in the world that designs or manufactures chips for Huawei and that is using American equipment or software to do so needs to obtain the license from the American government,” said Fabrice Jacob, CEO of JK Capital Management, quoted by Portfolio.

Faced with this, the company had to sell its subsidiary called ‘Honor’ and start focus on the investigation of a proprietary technology to develop microcomponents and software, which represented an expense of up to 23,500 million dollars and a quarter of the income.

However, Huawei assured that by February 2023 they have replaced more than 13,000 parts and this year it will emerge from the crisis.