Ren Zhengfei delivered an important speech: Huawei regards survival as its main program!
Huawei has been unable to launch 5G mobile phones since it was sanctioned by chips, which has greatly reduced its market share. Today, Ren Zhengfei, President of Huawei, delivered an important speech in Huawei, saying that Huawei regards survival as its main program, shrinks and shuts down all marginal businesses, concentrates its forces to fight the war of annihilation and improve profitability!
On the afternoon of the 22nd, Huawei's internal forum launched an article on "The business policy of the whole company should shift from pursuing scale to pursuing profit and cash flow"In Ren Zhengfei's view, the global economy will face recession and declining consumption capacity. Huawei should change its thinking and operating policy from pursuing scale to pursuing profits and cash flow to ensure that it can survive the crisis in the next three years
"Survival is the most important program. The peripheral business is shrinking and shutting down all over the country, passing the chill on to everyone. At the same time, we need to narrow the front, concentrate our forces to fight the war of annihilation, and improve profitability." Ren Zhengfei said.
Ren Zhengfei also said: "Our overly optimistic expectations for the future should be lowered. In 2023 or even 2025, we must take survival as the most important program to survive. Every business should be carefully implemented.".
Huawei must first find a way to overcome the difficult period of three years. Its survival basis should be adjusted to focus on cash flow and real profits. It can no longer only aim at sales revenue. The respite period of Huawei's life is 2023 and 2024. Whether Huawei can break through these two years is still uncertain. Therefore, everyone should stop telling stories and talk about realization. Especially in business prediction, do not hold illusions and tell stories to deceive the company. The loss should be deducted from your food package. First, you should survive, and if you survive, you will have a future.
As for all businesses, Ren Zhengfei mentioned that Huawei cloud computing should firmly support Huawei's business development and take the path of supporting the industrial Internet. Digital energy should increase investment in the opportunity window of the conference, create greater value, shrink institutions, strengthen combat teams, intelligent vehicle solutions, strengthen business closed-loop research and development, take the road of modularization, and focus on several key components to compete.
At the same time, it is necessary to extract marginal businesses from the strategic core. "After the marginal business is taken out, let's first evaluate whether it can be done well and how many resources are needed to do it. Building ICT (information and communication technology) infrastructure is Huawei's historical mission. The more difficult the time is, the more unwavering it will be“
Huawei's business performance in the first half of 2022 shows that in the first half of this year, it achieved sales revenue of 301.6 billion yuan, with a net profit margin of 5.0%. Among them, the operator business income was 142.7 billion yuan, the enterprise business income was 54.7 billion yuan, and the terminal business income was 101.3 billion yuan. From the data of the three main businesses, Huawei operator and enterprise business income increased by 4% and 27% respectively, but the terminal business declined by 25%.
After this speech, Huawei will adjust its business strategy, abandon illusions, recognize facts, and take survival as the primary goal. At the same time, it will increase the investment in cloud computing and digital energy, extract marginal businesses from the core strategy, and strive to improve profitability.
