Huawei profits tumble as global economy falters

Huawei said that although sales revenue for the period increased 5.1 per cent from the same time last year to 102.7 billion yuan (£10.4bn), operating profits tumbled 22 per cent to 8.79bn yuan (£886m), thanks to the slowing global economy which hampers industry growth.
In an e-mailed statement generated by Huawei, Operating profit in the first six months was 8.79 billion yuan ($1.4 billion), while the revenue gained 5.1 percent to 102.7 billion yuan.
A spokesperson had the following statement: The telecom industry is seeing a sluggish growth in 2012 owing to the global economic downturn, which has caused customers to reduce investments while the competition in this industry remains fierce. This has resulted in the operating profit in 2012 H1 being lower than that in 2011 H1.

ZTE said this month its first-half profit may have declined as much as 80 percent because of reduced investment income, foreign-exchange losses and delayed network contracts.

Ericsson, the world’s largest maker of mobile-phone networks, last week posted second-quarter profit that missed analysts’ estimates as carriers curbed spending to cope with a slowing economy.
Alcatel-Lucent SA (ALU), France’s largest phone-gear supplier, has predicted it will miss a 2012 profit target.

Huawei overtakes Ericsson as world's largest telco player by sales

Chinese Huawei Technologies moved ahead of Swedish telco giant Ericsson to become the world's largest telecom equipment vendor by sales for the first time, after it reported an increase of 5.1 percent in sales to 102.7 billion yuan (US$16.1 billion) on 24th July 2012.

Ericsson last week reported a drop in sales to 106.3 billion kronor (US$15.25 billion) during the 1H of 2012, less than Huawei's sales over the same period.
Huawei estimates 15 percent growth and expects its 2012 profitability to match last year's numbers.
Since 2011 Huawei has made aggressive expansion into the terminals market which has driven its revenue growth.
In the face of uncertainties in the global economy, many telecom equipment makers are scaling down costs.
In 2011, Ericsson sold half of the stake in its joint-venture Sony Ericsson to Sony and this deal to some extent dented Ericsson's scale.
Ericsson has placed increasing value on its global services and support solutions businesses which have accounted for about half of the company's revenues and have maintained rapid growth.

India and China account for 35% active mobile services users worldwide

The mobile services remained dominated by GSM services with 75% market share. CDMA and HSPA (3G) accounted for 15% market share.


According to a study by telecom equipment maker Ericsson that around 4.1 4.1 billion active mobile services users are from  India and China only that account for 35% users worldwide, which is equal to around 60% of the world's population.
Ericsson Traffic and Market Data Report highlighted that "Global mobile penetration reached 85% in Q4 (last quarter) 2011 and mobile subscriptions now total around 6 billion. "However, the actual number of subscribers is about 4.1 billion, since many subscribers have several subscriptions,".
The report said India and China accounted for approximately 35% of the estimated 180 million net additions during last quarter of 2011.

Moreover, Globally, mobile broadband subscriptions have grown around 60% year-on-year and have reached close to 1 billion mark.