Huawei is focusing on its budding cloud business, which still has access to US chips despite the sanctions against the company, to secure its survival, reported the Financial Times.
A person at a Chinese supplier to Huawei said the cloud business was key to Huawei stabilizing in its domestic market because Beijing would increasingly support the company through public cloud contracts.
Several people involved in Huawei’s cloud business said the unit was stepping up its offerings. “We will continue to provide customers with a package of [cloud] services and products,” said a person at Huawei familiar with the strategy. “The quality of the chips in it may not be as good as before, but for the other products that are not impacted, we will offer something with a little better quality, and the customers can accept it.” The change in focus was needed because the outlook for Huawei’s smartphone and other consumer products unit was “hopeless” in the face of a US ban that will choke off its access to mobile chips, said an FT source familiar with the business. The consumer unit was responsible for half of Huawei’s $122 billion revenue last year.