Huawei expects significant drop in phone sales due to US ban

Chinese telecommunications giant Huawei predicts its smartphone shipments will fall by about 20 percent this year, the first year-on-year decline as a result of US sanctions on its business.

The company shared its internal 2020 guidance to a limited number of managers from its consumer electronics division in January, according to information.

After nearly a decade of rapid growth, Huawei's recent decline in smartphone shipments comes from expected weak sales in Europe and other markets outside of China.

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People familiar with the situation said the US sanctions, which are blocking the Chinese firm from using Google for mobile services, have contributed to lower sales.

Deliveries of smartphones

Last year, Huawei managed to ramp up shipments of smartphones over 240m blocks despite pressure from US sanctions against the company back in May. This led the company to outsell Apple in smartphone sales for the first time, making it the world's second largest smartphone maker after Samsung.

As Huawei has been able to continue selling its P30 PRO and other smartphones that were released prior to us being banned, its overseas smartphone sales remain strong. However, this year the company expects its shipments to fall somewhere around 190m to 200m smartphones as a result of the ban.

US government sanctions that restrict the company's access to American technology, such as software from Google, are now starting to hurt Huawei's global growth. To make matters worse, the coronavirus outbreak has disrupted supply chains in China, and the company has been forced to close or restrict its 4,985 stores across the country.

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Dealing with US sanctions and the devastation caused by the coronavirus is likely to prove quite difficult for Huawei and the company could end up with a very tough year ahead.

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