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Huawei, with an eye on self-reliance, ploughs 25% of revenue into R&D at expense of profits
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Iris Dengin ShenzhenPublished: 5:40pm, 31 Aug 2026Updated: 6:05pm, 31 Aug 2026Huawei Technologies poured more than a quarter of its first-half revenue into research and development, prioritising long-term technological independence over short-term earnings as first-half profit plunged 36 per cent.
R&D expenses jumped 25 per cent year on year to 121.4 billion yuan (US$18 billion) for the six months through June, accounting for over 25 per cent of total revenue, according to a filing on Monday with the Shanghai Clearing House, the primary central clearing counterparty in China’s interbank market.
The surging technology spending, as well as rising component costs, pushed net profit for the Shenzhen-based giant down to 23.8 billion yuan from 37.2 billion yuan in the same period last year.
This marks the second consecutive year of declining first-half profits for the company.
Net operating cash flow also took a heavy hit, swinging to negative 39.9 billion yuan from a positive inflow of 31.2 billion yuan in the same period last year.
Still, revenue for the period rose 9.55 per cent to 467.8 billion yuan from 427 billion yuan a year earlier, bolstered by a strong rebound in smartphone shipments and accelerating demand for its artificial intelligence processors.
As a privately held entity, Huawei occasionally releases its operational figures via bond issuance disclosures on the clearing venue.
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