Huawei sees strong smartphone revenue rise, 36% profit drop in H1 2026

Huawei has released its earnings report for the first half of this year – H1 2026, showing a massive surge in smartphone revenue but a notable drop in overall profit. The company has also increased R&D spending in the period. Here is the full breakdown.

Per the report, Huawei has earned a net profit of 23.81 billion yuan – a 36% YoY decline, regardless of smartphone revenue seeing a sharp jump of 9.6%  in H1 2026.

The overall revenue has reached 467.82 billion yuan and continues to show recovery from the US export controls. Over the years, the company has worked not only to get back on the 5G phone track but also achieved growth in its other businesses.

Speaking of the profit, the drop is mainly due to Huawei’s surging input costs and “heavier” spending on research and development, which overshadowed revenue growth. These expenses signify the OEM’s decision to cut reliance on foreign tech.

Huawei underscored that R&D spending increased to 25.2% to 121.38 billion yuan in the first half of this year for AI, communication technology, smart devices, and self-driving solutions. This is almost 25.9% of the earned revenue.

Adding more, the company said its first-half revenue and profit results were quite in line with its expectations. However, the full-year result is unclear due to higher operational expenditure and market situations (rising component costs).

In H1 2025, Huawei reported revenue of 427 billion yuan ($59.84 billion) with a profit drop of 32% year-on-year. The revenue saw a 4% increase over 2024.

But this time, the company’s profit declined further to 36% due to significantly prioritizing long-term operational spending over short-term earnings.

Details reveal that Huawei’s manufacturing cost has raised by 12.4% – more than revenue growth. On the other hand, administrative costs also went through a hike.

The business segment breakdown is missing from the report. However, the firm says all of its businesses have grown effectively in the first half of this year.

(Image Credits: Huawei)