Some people familiar with this issue said that Huawei has reduced its revenue target for 2020 in India by 50%. It also intends to lay off 60% -70% of its staff, excluding staff in R&D and global service centers.
Huawei’s move is mainly to respond to the sharp decline in demand for equipment and services in India. Huawei has not yet commented on this.
Why did Huawei lower its revenue target?
In 2017, Huawei India’s revenue was $ 1.2 billion and decreased every year. One of the main reasons is that the financial situation of the Indian telecommunications company itself is tight. It has led to a decrease in demand. Huawei has set its revenue target for 2020 in India from $ 350 million to $ 500 million. It is lower than the previous range of 700 million to 800 million dollars.
Huawei’s reason for lowering its revenue target is that the company does not expect two major telecommunications customers in India to place new orders. Bharti Airtel and Vodafone Idea are Huawei’s two largest telecommunications customers in the Indian market. The source said, “the company intends to reduce the number of full-time employees, contract workers and third party employees in India.”
The partnership between Huawei and Bharti Telecom is also in jeopardy. The latter can work with Ericsson. Last year, Huawei lost orders from the Rajasthan region. Once Huawei loses its partnership with the rest of Tamil Nadu, the partnership between Huawei and Bharti Telecom will only provide equipment for the telecommunications company’s two areas of service.
“The redundancies mainly involve employees in network support, installation, outsourcing and sales departments, because telecommunications operators do not currently have new plans or intentions to achieve new cooperation,” said one person familiar with the matter.
Another person familiar with the matter said: “The company currently only needs a few people to maintain the annual contract it signed with the telecommunications operator. Those who are still in the company are very worried about their job because there are not many opportunities in the market.
India has its own mistake
Huawei’s consumer business or smartphone company in India has also declined. The company has not yet released many devices in India.
Read also: Huawei India CEO: Indian government strongly supports Huawei
New Delhi had previously banned Indian government agencies from buying equipment from Chinese companies such as Huawei and ZTE. In addition, India has also unofficially urged private telecommunications companies to replace Chinese equipment over time, but does not want to disrupt consumer services.