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Huawei Enterprise Business Grew More In Europe Than Home Last Year (THE WALL STREET JOURNAL)

Mar 25, 2014

CEO Xu Maintains Division's Target of $10 Billion in Sales by 2017


By Archibald Preuschat

Updated March 10, 2014 2:33 p.m. ET

HANNOVER—Chinese telecom equipment maker Huawei's enterprise business saw more growth in Europe last year than in its home market, the division's Chief Executive William Xu told The Wall Street Journal Monday in an interview at the CeBIT trade fair in Hannover.

The enterprise segment, Huawei's smallest, produces network gear for customers. The division posted 32% growth on the year in 2013, missing its 40% growth target, Mr. Xu said.

"The (2013) target was very ambitious to motivate staff", Mr. Xu said, but he maintained the division's target of reaching $10 billion in sales by 2017, four times the sales figure achieved last year.

Europe is crucial for the segment's growth strategy, Mr. Xu said, adding he considers Europe its most important market. Huawei competes with Cisco and Juniper, but has a weak position in the U.S., where the Chinese firm is virtually banned from selling network gear to telecommunication firms due to security concerns.

At CeBIT Tuesday, Huawei will launch its first memory server for use with SAP's real-time data analysis platform HANA. The server targets mainly western European and Asia Pacific markets. SAP's HANA platform reduces the time for analyzing large amounts of data.

In the interview Mr. Xu said, that Huawei's enterprise division will do better in 2014 than in the previous year, but didn't specify targets.

He also said the division will raise its spending on research and development, which was $600 million in 2013, by 10%. "But we will benefit also from research and development of overall Huawei, which allows us to have the most innovative products," he said.