Huawei Rotating Chairman Ken Hu said the telecommunications, networking and cloud infrastructure giant “weathered the storm” of 2023 and is “pretty much back on track” as it enters 2024, though that qualifier for the new year highlights Huawei’s ongoing operational challenges.

Hu’s comments were part of his “New Year Message for 2024,” which is an annual message from Huawei’s standing leader. In it, Hu stated that the vendor was set to post a roughly 10% year-over-year increase in overall company revenues, boosted by a device business that “surpassed expectations,” and solid results from its information and communications technology (ICT) operations.

“Our ICT infrastructure business is the company's ballast and needs to continue serving in this role,” Hu wrote. “That means making the most of its advantages across domains like computing, storage and networking, and leveraging its systems engineering capabilities to provide end-to-end support for the digital and intelligent transformation of industries. In particular, our carrier business needs to more effectively support the business success of our customers by helping them boost data traffic, innovate new services and drive network evolution.”

Hu also stated the growing importance of Huawei’s cloud business, which “should aim to become the company's digital backbone, enabling all aspects of our operations, while providing all industries with a trusted platform that helps them grow and flourish.”

Research firm Canalysys recently ranked Huawei No. 2 among China’s cloud providers for the third quarter of 2023, just behind Alibaba and ahead of Tencent. Huawei controlled 19% of the market in Q3, with growth fueled by the cloud provider’s AI Gallery platform launch in September and its strategy for global expansion. Huawei also claimed a 400% year-over-year increase in the number of cloud partners in Europe and plans to have 1,000 European startups as cloud customers in the next five years.

More broadly, Hu stated plans for Huawei to drive more efficiencies out of its organizations and provide for more regional operating autonomy. This was to counter ongoing financial headwinds being experienced by many of its customers and the need for Huawei to be more flexible in its approach to varying challenges.

These challenges have been felt throughout the equipment space, with Dell’Oro Group recently forecasting the global radio access network (RAN) market will post lower overall revenues for all of 2023 compared to 2022.

However, vendors are optimistic the market will rebound in 2024.

“We expect a gradual recovery toward late in 2023, and then improve in 2024,” Ericsson CEO Börje Ekholm told investors during the vendor’s second-quarter earnings call.

Hu’s letter also included various security and cybersecurity references, highlighting an ongoing geopolitical point of contention for the vendor.

“We have to be aware that changes in the business environment are not caused by geopolitical conflict alone, but also by fluctuating global economic cycles,” Hu wrote. “We should approach these changes rationally, work to better understand the industrial policies and requirements of different countries and regions, and make positive contributions where we can.”

These changes are continuing efforts by Western countries to bar the use of new Huawei equipment and their ongoing work toward replacing Huawei equipment that is already in use.

The most pointed efforts remain in the United States, where the government has barred the use of any new Huawei telecommunications gear and is funding efforts to replace legacy equipment.

“For our business in the United States, our business has basically gone away because of the restrictions on the ability to sell, the limitations on the ability of the American semiconductor industry to sell to us and other China-based companies,” Andy Purdy, chief security officer for Huawei, told SDxCentral in an interview last year. “Our focus was not a priority for the United States; now we’re focusing on those countries that are interested in having us, where their partners are going to partner with us.”

Purdy explained that this ongoing challenge in the U.S. has resulted in Huawei not having any discussions with telecom operators in the U.S. “or trying to plan ahead for something when the impact of the United States on the rest of the world is a continuing issue.”

“When you’ve got people disagreeing, when you’ve got a toxic political environment, it makes it really challenging,” he added.

Huawei is finding similar sentiment in Western Europe.

The European Union recently strengthened its stance on banning the use of 5G telecommunications equipment from Huawei and fellow China-based vendor ZTE and could restrict funds for member states that fail to implement a ban.

This has allowed a number of Huawei and ZTE rivals like Ericsson, Nokia and Samsung to gain market share in Western Europe.

Hu’s message does reference those outstanding challenges, but understandably constructs a path toward a successful outcome.

“We need to continue to forge ahead and unite as many people as possible,” Hu wrote. “Together, we can overcome any challenge. As long as we keep our feet on the ground, we will move ahead steadily toward greater success. Great people create great times, and we're laying the groundwork for more heroes to emerge and shine.”