Huawei announced Tuesday that it has decided to sell its Honor sub-brand to Shenzhen Zhixin New Information Technology, as part of a deal whose financial terms were not disclosed.
“Huawei’s consumer business has come under enormous pressure lately. This is due to a persistent unavailability of the technical elements necessary for our mobile telephony activity. The company said in a statement.
“This decision was made by Honor’s industrial chain to ensure its own survival. More than 30 agents and resellers of the Honor brand first proposed this acquisition. ”
The Chinese giant said that once the deal is done, Huawei will “not own any shares or be involved in any business management or decision-making activity” related to Honor.
Honor, a sub-brand that offers mid-range handsets to the smartphone market, has reached the milestone of selling more than 70 million devices per year, Huawei said.
“We look forward to seeing Honor continue to create value for consumers and build a smart new world for young people,” said Huawei.
The sale is the first major structural victim inflicted on Huawei because of the bans imposed on it from Washington.In September, Rotary Chairman Guo Ping said the company will continue to do everything in its power to strengthen its supply chain, although it continues to be under “great pressure” and is continually ” attacked ”.
“Huawei is in a tough spot these days. Endless aggression put us under great pressure, ”he said at the time.
“We always assess the specific impacts. Right now, the goal is survival.
“The United States continues to attack us and has changed its laws for the third time, which has posed great challenges to our production and operations. ”
Despite the rhetoric, in fiscal terms Huawei has continued to grow.
In its third-quarter tax return released last month, Huawei said it saw its revenue increase 9.9% to 671 billion yuan.
“In the first three quarters of 2020, Huawei’s business results have basically met expectations,” he said.
“As the world grapples with COVID-19, Huawei’s global supply chain is under intense pressure and its production and operations face significant challenges. The company continues to do its best to find solutions, survive and move forward, and meet its obligations as customers and suppliers. ”
During the weekend, Reuters reported that the United States has approved Qualcomm to sell 4G chips for mobile phones to Huawei.
Due to Huawei’s bans, companies involved in manufacturing or designing equipment using American technology need a license to sell to the company.