‘Anti-establishment friction is here to stay’

Challenges in the external environment will not impact our plans, says Eric Xu  

Huawei Technologies does not see ‘anti-establishment frictions’ going away any time soon and is prepared to work in such an environment for a ‘long time’, Eric Xu, the technology giant’s chairman said on Friday.

Mr. Xu, however, added that the U.S. restrictions may impact the firm’s smartphone revenues by $10 billion, while stating that the U.S.-government’s 90-day extension to a reprieve allowing it to buy components from U.S. firms has had no impact on Huawei Technologies.

“The extension has had no impact on Huawei. We already have got used to living and working with anti-establishment frictions,” Mr. Xu said on the sidelines of a conference to launch a new artificial intelligence chip at its headquarters.

He added, “We also believe it is not very likely for Huawei to be relieved from such a working state. Huawei as a company and our employees... are fully prepared for living and working with such an environment for a long time.”

Asked about a two-month old statement by Huawei CEO Ren Zhenfai that U.S. restrictions may impact the company’s revenue by $30 billion, Mr. Xu said, “...situation is not as pessimistic [now]... May be that was the forecast of possibly the worst scenario. Now the situation is much better than we had forecast.”

He, however, added that these external factors may lead to an impact of about $10 billion on the firm’s global smartphone sales. In 2018, Huawei’s revenue from devices business stood at nearly $50 billion.

The “many challenges in the external environment”, Mr. Xu, pointed out, will not impact Huawei’s plans related to either its AI strategy or research and development.

Huawei on Friday launched “world’s most powerful AI processor” Ascend 910, under its Ascend-Max chipsets. The new chipset is aimed at making “more affordable and abundant computing power” to help AI development.

The company also unveiled its open source AI computing framework that will make it easier for developers to make AI applications. Huawei’s AI strategy is designed to bridge these gaps, a statement said.

(The writer was in Shenzen at the invitation of Huawei Technologies)