Huawei's 2015 EMEA sales contribute to biggest revenue rise since 2008

Huawei attributed revenue growth in EMEA during 2015 to rapid increases in demand for wireless and fixed networks, and a growing share of the region's smartphone market.

EMEA territories were Huawei's second-largest market in terms of revenue generation after China. Revenue in the region grew 27.2 per cent year-on-year to CNY128 billion (€17.3 billion/$19.8 billion), which accounted for close to a third (32 per cent) of Huawei's total 2015 revenue of CNY395 billion.

In its annual report, Huawei said it had achieved a top three position in "certain developed Western European countries" in terms of smartphone market share.

Huawei's total smartphone shipments in 2015 grew by 44 per cent year-on-year, which the vendor stated was far higher than the industry average. The company revealed in January that it shipped 108 million smartphones in 2015.

The China-headquartered vendor grew its net profit by 32.5 per cent year-on-year to CNY36.9 billion in 2015. The vendor said the figure increased "due to increasing revenue and higher efficiency," noting that its 2015 revenue was 37.1 per cent higher than in 2014.

While Reuters noted that 2015 represented Huawei's best year of sales growth since 2008, Fortune begged the question of just how much that increased revenue is costing Huawei in real terms. The news agency pointed to a 2.5 per cent year-on-year drop in Huawei's gross margin to 41.7 per cent as a cause for concern.

The decline in gross margin could be due to high sales incentives Huawei offers to smartphone retailers in China, IDC analyst Bryan Ma told Fortune. Also, while Huawei stated in its annual report that it had improved its position in the mid-tier smartphone market, Ma noted that the vendor is currently pushing to increase sales in the high-end of the market, where margins are higher.

Huawei's 2016 forecasts signal a slowdown in all of its markets, Reuters noted. According to the news agency's calculations, Huawei's predicted 2016 revenue of $75 billion (€65.6 billion) points to a growth rate of 23 per cent -- around half that it generated in 2015.

The vendor predicted revenue from its consumer devices business in 2016 would be $30 billion, which Reuters noted suggests a growth rate of 51 per cent this year compared to around 73 per cent in 2015.

For more:
- see Huawei's annual report (PDF)
- view this Fortune report
- read this Reuters article

Related articles:
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Gartner: Apple smartphone sales recorded first year-on-year decline during Q42015
TIM teams with Huawei to accelerate NB-IoT technology development
Huawei fends off Chinese rivals to secure place as world's third-largest smartphone vendor
Huawei's Western Europe consumer business grows revenues 45% in 2015

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