Chinese telecoms giant Huawei reported a profits plunge of 53% this week despite revenue rising 11.7% to around 204bn yuan last year.
The company has responded by bringing in three revolving CEOs to better focus the company in a fast changing environment.
The private company’s annual report showed net profit standing at 11.6bn yuan for 2011 after it invested significant amounts on R&D and in promoting its own-brand smartphones. The manufacturer shipped over 20 million smartphones in 2011.
Huawei said it had raised R&D investment year on year by 34%, to 23.7bn yuan.
The company pointed to the tough global economic climate and said it was working in intensely competitive’ markets, ‘in terms of price, functionality and service quality as well as the timing of new product and service development.'
However, Huawei acting CEO Ken Hu said he was confident it is in a position to grow. He said: ‘In 2011, Huawei increased its investment in the enterprise and consumer business segments, and achieved all-around growth on the back of strong business momentum generated by the company’s successful transformation into a complete end-to-end ICT solutions provider.’.
‘We have made strategic investments, augmented our R&D capabilities and deployed resources globally, and implemented a future-oriented business architecture that puts Huawei in a confident position for sustained growth.’
Explaining the decision to take on three CEOs to run the company, Huawei CEO and founder Ren Zhengfei said: ‘By authorising a group of ‘bright minds’ to act as rotating and acting CEOs, the company allows them to make decisions within certain boundaries while they face a constantly changing world. This is our rotating CEO system.’