For the first time, Huawei has put some numbers behind the impact that the U.S. ban is having on its bottom line.
During an on stage presentation with U.S. technologists George Gilder and Nicholas Negroponte that was held Monday at Huawei's headquarters in Shenzhen, China, Huawei CEO and founder Ren Zhengfei said his company had reduced its revenue forecast for the year.
During the close two-hour presentation, which Huawei streamed, Ren said that Huawei's revenue would be down 30%, and that revenue would come in at an estimated $100 billion.
In its first publicly released earnings report earlier this year, Huawei reported a net profit of close to $9 billion in 2018, which was an increase of 25% compared to the previous year. Huawei's revenue for the year increased by almost 20% to $105 billion, which was its fastest growth in two years, but short of a projection the company provided in January.
Huawei is the world's largest telecom equipment vendor ahead of Ericsson, Nokia and Cisco. It's also the second-largest maker of smartphones behind Samsung, but ahead of Apple.
Citing security concerns, the Trump administration put Huawei on an export blacklist. The U.S. has maintained that Huawei works with the Chinese government by providing backdoor access to its telecom gear for espionage purposes, which Huawei has long denied. Last month, the Trump administration increased tariffs to 25% on $200 billion worth of Chinese products.
The U.S. Department of Commerce imposed a trade ban that threatens to choke off Huawei's supply chain to Google's Android operating system for phones and tablets, as well as silicon chips and components from various vendors, such as Intel and Arm.
“We cannot get components supply, cannot participate in many international organizations, cannot work closely with many universities, cannot use anything with U.S. components, and cannot even establish connection with networks that use such components," Ren said, according to a story by Reuters.
Ren said that he didn't expect "they would attack us on so many aspects," according to Reuters. Ren also said that he expected Huawei's revenues would bounce back in 2021 as it starts to build new products, and use its own operating system for smartphones and tablets.