Huawei H1 2025 Net Profit Drops 32% Amid Rising R&D Costs
Huawei reported a significant 32% year-on-year decline in net profit for the first half of 2025, despite achieving modest revenue growth. The Chinese technology giant posted revenue of RMB 427.04 billion ($58.5 billion), representing a 3.95% increase from the previous year. However, net profit fell to RMB 37.195 billion ($5.1 billion) due to escalating operational costs and heavy investment pressures. Research and development expenditure surged by 9.04% to RMB 96.95 billion, accounting for 22.7% of total revenue, as the company intensified focus on AI computing, foldable devices, and smart vehicles. While the consumer business showed signs of recovery with over 12 million HarmonyOS 5 devices shipped and nearly 900,000 smart vehicle deliveries, profitability was squeezed by a 9.33% rise in operating costs and widened fair value losses totaling RMB 5.84 billion. Additionally, higher costs associated with advanced chips further strained earnings. This financial performance highlights Huawei's strategic prioritization of long-term technological innovation and market expansion over short-term profit margins amidst a challenging global semiconductor landscape.
Wire timeline
Huawei H1 2025 Net Profit Drops 32% Amid Rising R&D Costs
Huawei reported a significant 32% year-on-year decline in net profit for the first half of 2025, despite achieving modest revenue growth. The Chinese technology giant posted revenue of RMB 427.04 billion ($58.5 billion), representing a 3.95% increase from the previous year. However, net profit fell to RMB 37.195 billion ($5.1 billion) due to escalating operational costs and heavy investment pressures. Research and development expenditure surged by 9.04% to RMB 96.95 billion, accounting for 22.7% of total revenue, as the company intensified focus on AI computing, foldable devices, and smart vehicles. While the consumer business showed signs of recovery with over 12 million HarmonyOS 5 devices shipped and nearly 900,000 smart vehicle deliveries, profitability was squeezed by a 9.33% rise in operating costs and widened fair value losses totaling RMB 5.84 billion. Additionally, higher costs associated with advanced chips further strained earnings. This financial performance highlights Huawei's strategic prioritization of long-term technological innovation and market expansion over short-term profit margins amidst a challenging global semiconductor landscape.
TechNode