Financial Highlights

Huawei reported a total revenue of RMB 704.2 billion (approximately USD 99.4 billion), marking a 9.6% increase from the previous year.

The company’s net profit rose dramatically to RMB 86.95 billion (approximately USD 12.28 billion), illustrating Huawei’s effective management and strategic realignment in response to external pressures and market dynamics.

The ICT infrastructure segment, a cornerstone of Huawei’s business, generated RMB 362 billion, a modest increase of 2.3% year-over-year. Meanwhile, the consumer business, including smartphones and other smart devices, brought in RMB 251.5 billion, surging by 17.3%.

The company’s burgeoning cloud computing and digital energy sectors witnessed growth rates of 21.9% and 3.5% respectively, further diversifying Huawei’s revenue streams. Notably, the smart car solutions business stood out with a remarkable growth of 128.1%, although from a smaller base, signaling Huawei’s strategic pivot towards new technology frontiers.

Strategic Investments in R&D

Huawei’s commitment to research and development (R&D) remained steadfast, with an investment of RMB 164.7 billion in 2023, accounting for 23.4% of its total revenue.

Over the past decade, the company has invested more than RMB 1.1 trillion in R&D, underscoring its long-term vision to lead in technological innovation and contribute to the global digital economy.

Expanding Global Footprint and Ecosystem

The report highlights Huawei’s efforts in expanding its global ecosystem and fostering open innovation. By the end of 2023, Huawei Cloud boasted over 6 million developers and more than 40,000 partners worldwide, creating a vibrant and innovative digital ecosystem.

Future Outlook

Looking ahead, Huawei remains optimistic about its future growth prospects. The company plans to continue its investment in core ICT technologies and platforms, enhancing its product and service offerings across different sectors.

Huawei’s chairman, Hu Houkun, emphasized the importance of quality, innovation, and open collaboration with partners to create greater value for customers and society at large.

The fourth quarter of 2021 saw a year-on-year increase of 33% to US$7.7 billion. Canalys predicts that by 2026, the scale of the cloud infrastructure market in the mainland will reach US$85 billion, and the five-year compound annual growth rate will be 25%.

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Alibaba Cloud remains the leader with a 37% market share, ranking first in the cloud market in 2021, Huawei Cloud and Tencent Cloud second and third respectively, and Baidu AI cloud fourth. In 2021, the four cloud providers jointly accounted for 80% of the market share.

Huawei Cloud reached an 18% market share in 2021, with an annual growth of 67%. The rapid growth has widened the gap between Huawei cloud and Tencent Cloud, ranking second in the market.

Tencent cloud, the third-largest provider, accounted for 16% of the market share, an increase of 55%. Tencent Cloud grew steadily as a whole in 2021, with diversified growth in multiple sectors.

Baidu AI Cloud, the fourth-largest vendor, accounted for 9% of the market share, an increase of 55%.

Top 10 forecasts for China cloud computing market 2021-2024

China’s Public Cloud Services Market to Grow to 10.5% of global share by 2024

In 2020, the overall market size of global public cloud services (IAAs/PAAS/SaaS) reached US$312.42 billion, with a year-on-year growth of 24.1%, according to IDC.

The overall market size of China’s public cloud services reached US$19.38 billion, with a year-on-year growth of 49.7%, with the highest growth rate in all regions of the world. IDC predicts that the global share of China’s public cloud service market will increase from 6.5% in 2020 to more than 10.5% by 2024.

Check out market share of IaaS and PaaS markets in China here.

CIW Subscribers (Annual) can download the chart here to see the comparison of the cloud platforms in China.

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From the IaaS + PaaS market perspective, the first half of 2021 increased by 43% (vs. 48.6% in H1) year-on-year, down 6% from the first half of 2021, but still maintained the highest growth rate in the world.

In the next five years, China’s public cloud market will continue to grow at a compound growth rate of 30.9%. By 2026, the market is expected to reach US$105.76 billion, and the global share of China’s public cloud service market will increase from 6.7% in 2021 to 9.9%.

The competition in China’s cloud computing extends from focusing on infrastructure to the competition of comprehensive cloud platform capabilities. In addition to increasing investment in infrastructure construction at the IaaS layer, cloud vendors also continue to strengthen chip self-research capability, improve PaaS capability (data processing capability, cloud-native, low code development, etc.), build leading, fast, and perfect solution service capability and implementation and delivery ecology and develop a more comprehensive cloud platform.

The digital transformation of government and enterprises has fully entered the cloud era.

In the first half of 2021, the State Council put forward decisions on deepening the integrated development of new-generation information technology and manufacturing industry and creating new advantages of the digital economy.

Also read: the latest on China’s public cloud market

Local governments and regulators have issued relevant technical specifications and application standards of cloud computing platforms, actively promoted the all-around and in-depth integration of digital technology and social development, and accelerated the application and implementation of digital technology in various industries.

Cloud computing has become the basis and hub of digital transformation. Under this background, there is a huge demand and market space for cloud services in the field of government and enterprises.

Cloud vendors have released their own cloud-native strategies to seize the opportunity from the aspects of products, partners, standard-setting, talent cultivation, and so on.

Industry digitization and low-carbon development have become the mainstream trend. In terms of themselves, cloud vendors continue to improve product energy efficiency and promote the low-carbon development of the cloud industry by investing in innovative energy-saving technologies.

In terms of industry empowerment, cloud manufacturers invest in power electronics technology and integration and innovation with digital technology, promote the development of clean energy and the digitization of traditional energy, bring digital technology to each industry, and support all walks of life to promote low-carbon development through digitization.

In both IaaS and Iaas+PaaS markets, the competition is tight. The leading vendors Alibaba Cloud, Huawei Cloud, and Tencent Cloud have firmly taken the top three positions and jointly have 60% of the market share.

Cloud vendors in the network operator camp grew rapidly, with independent research and development and cloud network integration as their keywords.

The fourth ranked China Telecom Tianyi Cloud formed a full-stack cloud product system by the end of 2020, further deepened to the vertical industry and territory in 2021, sank the resource and service team to the local city, and the local cloud business grew rapidly, creating a new growth level for Tianyi Cloud.

Pricing only the 2nd most important in China for choosing cloud vendors

Energy Expert provides actionable insights and energy-saving recommendations to help customers accelerate their sustainability journeys. It helps customers automate the carbon accounting and reporting process at a corporate and product level, and obtain real-time sustainability impact statistics for them to make informed decisions.

It enables companies to identify the sources of the carbon emissions from their daily business activities as well as the full life cycle of their products, based on the PAS 2060 and ISO 14064 standards on carbon neutrality.

Customers can also quantify their carbon footprint through a prebuilt calculation model leveraging public emission factors datasets and Energy Expert’s proprietary datasets.

It provides visibility into their real-time carbon emission patterns and the progress of their sustainability performance through visualizations on dashboards and online reports. In addition, Energy Expert provides analytics on energy efficiency and emission forecasts through deep learning-based AI models hosted on Alibaba Cloud.

To help customers minimize their overall environmental impact, Energy Expert also offers actionable optimization plans with recommendations that balance business growth and environmental impacts. These can include increasing the use of clean energy, reducing excessive electricity consumption during peak times, and optimizing the supply chain ranging from sourcing materials to shipping products.

It has served over 2,000 companies in China since its deployment in February 2022, generating energy savings of over 2 million kilowatt-hours per day, or a reduction of 400,000 tons of carbon dioxide emissions, according to Alibaba.

Top 10 forecasts for China cloud computing market 2021-2024

Dubbed the “Land of Hope”, the XiRang platform enables up to 100,000 online attendees to interact simultaneously in the same space.

According to Robin Li, Baidu CEO, Chairman, and Co-Founder, intelligent transportation will see a significant transformation in the next 10-40 years that will greatly influence the future.

Purchase restrictions limiting the number of cars sold in China’s first-tier cities, and number plate restrictions reducing by 20% the number of cars on the roads on weekdays will be lifted within five years and improved traffic efficiency will solve urban congestion within 10 years.

Li believes that intelligent transportation can address three major problems: Firstly, it can reduce road traffic accidents by 90%. Secondly, the problem of urban congestion can be resolved. Lastly, autonomous driving and intelligent transportation will help reduce carbon emissions.

From autonomous driving to smart cars and smart roads, Baidu has deeply integrated AI, 5G, and cloud computing into the transportation sector.

With a total of 115,000 rides provided by the third quarter of 2021, Baidu’s autonomous ride-hailing platform “Apollo Go” has become the largest autonomous mobility service provider in the world.

Baidu’s future goal is to expand the “Apollo Go” service to 65 cities by 2025 and 100 cities by 2030.

Also read: Top 10 AI Cities in China

Baidu AIR intelligent road system will achieve real-time optimization of “city-level” signal control at hundreds of thousands of road intersections, greatly enhancing vehicle safety over millions of kilometers across the country.

Baidu believes that automotive robots will be the ultimate form of vehicle transportation in the future. Having L4 intelligent driving capabilities, Baidu’s smart EV venture, Jidu Auto, has been designed to operate under the concepts of “free movement”, “natural communication”, and “self-improvement”.

Li said that Jidu is planning to release its first concept car in the first half of 2022, followed by mass production and delivery by 2023.

At the convention, Baidu Chief Technology Officer Haifeng Wang released Baidu AI Cloud digital avatar platform XiLing, which is a platform level product integrating digital avatar generation and content production.

It can provide creation and operation one-stop services such as virtual host, virtual idol, brand spokesperson creation and operation for radio, television, Internet, brand and other customers.

Apart from providing an “AI toolkit” to creators, Baidu Brain also provides the technological foundation for digital transformation in society and many industries. Baidu Brain’s approach relies on standardization, automation, and modularization for industrial mass production, which allows it to evolve into an AI mass production platform.

“Wenxin”, Baidu Brain’s recently-released technological breakthrough, is the world’s first knowledge-enhanced 100-billion-scale pre-trained language model and the largest Chinese-language monolithic model.

Baidu’s open-source deep-learning platform PaddlePaddle has garnered 4.06 million developers, served more than 157,000 enterprises and units, covered dozens of industries, and created almost 500,000 models. PaddlePaddle’s combined market share ranks first among China’s deep-learning platforms.

Computing power is one of the core elements to support AI development. Baidu created the base for green computing, including self-developed Kunlun AI chips, an AI heterogeneous computing platform Baige, and a green data center to support AI technology research and a wide range of applications.

Baidu Brain can support across 1,400 capabilities. Baidu AI Cloud can distribute the AI technology capabilities to various industries, contributing to digital transformation and intelligent enhancement of China’s industries, economy, and society.

Report: China growth AI companies overview

Alibaba Cloud unveiled a new in-house processor design for use in its data centers. The server chips, named Yitian 710, are custom-built by Alibaba Group’s chip development business, T-Head.

Powered by these chips, Alibaba Cloud also announced the development of its proprietary servers, called Panjiu.

Alibaba plans to use the chips to support current and future businesses across the Alibaba Group ecosystem. It will also offer its clients next-generation computing services powered by the new chip-powered servers in the near future.

Built upon advanced 5nm process technology, Yitian 710 is powered by 128 Arm cores with 3.2GHz top clock speed to deliver exceptional performance and excellent energy efficiency.

Each processor chip has 60 billion integrated transistors. Yitian 710 is the first server processor that is compatible with the latest Armv9 architecture and includes 8 DDR5 channels and 96-lane PCIe 5.0, providing high memory and I/O bandwidth.

Yitian 710 achieved a score of 440 in SPECint2017 (a standard benchmark to measure CPU integer processing power), surpassing that of the current state-of-the-art Arm server processor by 20% in performance and 50% in energy efficiency.

Panjiu was developed for the next-generation of cloud-native infrastructure. By separating computing from storage, the servers are optimized for both general-purpose and specialized AI computing, as well as high-performance storage.

With a modular design approach for large-scale data center deployment, these servers are expected to deliver exceptional economic value for a wide variety of cloud-native workloads, such as containerized applications and computed optimized workloads.

Alibaba also announced that it will open the source code of the XuanTie IP core series, among other upcoming cores. The XuanTie series is Alibaba’s custom-built processor based on RISC-V instruction-set architecture.

Developers can now access the source code of the XuanTie series IP cores on Github and Open Chip Community to build prototype chips of their own, which can be customized for IoT applications such as networking, gateway and edge servers.

In addition, XuanTie-related software stacks, which support multiple operating systems, including Linux, Android, RTOS, and Alibaba’s own AliOS, will also be opened. Alibaba will provide more services and support for development tools, SDKs and customized cores in the future.

Alibaba released its first AI inference chip Hanguang 800 in 2019. The AI chip has been deployed in Alibaba Cloud’s data centers to power businesses in areas such as search, recommendation and live streaming.

China IoT market forecast 2021-2024; Internet of Vehicles the fastest growing segment