What you need to know
- Huawei has been unable to work with Google since its inclusion on the Entity List in May 2019.
- The company thought it could handle the loss by creating its own replacement for Google's services on top of its already good hardware.
- Huawei was in-fact not able to handle it and reported a shortfall of $12 billion.
Huawei's first year without Google Play services didn't go as smoothly as the firm hoped it would. The company fell short of its revenue targets for 2019 by billions of dollars, mostly attributed to the ongoing disruption of the consumer division which makes its phones, tablets, laptops and so on.
As reported by CNBC:
"We didn't meet our revised targets, which was the $135 billion mark. We were short by $12 billion. This was the results of the U.S. sanctions," Xu said Tuesday, according to a CNBC translation of his comments in Mandarin.
A large part of Huawei's revenue shortfall occurred in the consumer division which accounted for over 54% of the company's total sales in 2019. It overtook Huawei's core networking equipment business to become the biggest division in 2018.
"It is the consumer business of Huawei that was hurt the most," Xu said.
The unit, which includes smartphones and laptops, brought in revenue of 467.3 billion yuan or $66.93 billion in 2019. That was $10 billion less than Huawei was targeting.
"We look at the consumer business, if everything goes on without being disrupted last year, the revenue from the consumer business would at least be $10 billion U.S. dollars more than the numbers we actually achieved," he added.
Huawei makes excellent phones, but without Google's apps and services to make them useful, they are naught by pretty glass baubles for users in Western Europe and North America.
Commenting on the P40 Pro, we noted that while it was possible to get some apps not available in Huawei's AppGallery, users would be faced with "a hodgepodge of uncertainty that's more than likely to frustrate."
All things being equal, when faced with a just as good(or even slightly worse) Oppo or Xiaomi phone with Gooogle's apps and services onboard, it's a no-brainer which option will be more appealing to consumers.
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