BEIJING (AP) — Chinese tech giant Huawei said Friday its revenue slumped in the first half of 2022, but new companies in autos and other industries helped offset a drop in smartphone sales under the hood. US sanctions.

Revenue fell 5.9% from a year earlier to 301.6 billion yuan ($44.8 billion) in the six months to June 30, the company said, the largest manufacturer of network equipment for telephone and Internet operators. It made no profit but said its profit margin was 5%, which would be around 15 billion yuan ($2.2 billion).

Huawei Technologies Ltd., China’s top global tech brand, has struggled since President Donald Trump blocked access to US processor chips and other technologies in 2019. The company denies US accusations that it This is a security risk and could facilitate Chinese espionage.

Huawei, headquartered in Shenzhen near Hong Kong, has accelerated the development of network technology for automotive, hospitals, mining and manufacturing. He says he is now less vulnerable to US sanctions.

“While our devices business was heavily impacted, our ICT infrastructure business maintained steady growth,” Ken Hu, one of three executives who rotate as chairman, said in a written statement.

The drop in sales in the first half is an improvement on a 14% drop recorded for the first three months of the year. The profit margin was higher than the 4.3% in the first quarter.

Sales of Huawei’s device unit, which includes smartphones, fell 25.3% from a year earlier to 101.3 billion yuan ($15 billion). Sales of network equipment to telecom operators and enterprises increased.

Huawei reported a profit of 113.7 billion yuan ($17.8 billion) last year, but said revenue fell 28.6% from 2020.

His car company has played a role in five models launched by three Chinese automakers. Huawei provides components and software for navigation, dashboard displays, vehicle systems management and other services.

Huawei, founded in 1987, claims to be owned by Chinese citizens who make up half of its 195,000 employees worldwide. It began announcing its financial results a decade ago in a bid to defuse Western concerns about the company’s security.

Also on Friday, Huawei expressed concern about a new US law, the CHIPS and Science Act, which promises aid to companies that invest in the production of processor chips in the United States. It aims to reduce US dependence on Taiwan, which produces most of the world’s high-end chips, and China, which assembles most smartphones and other electronics.

Any measure that reduces global industrial collaboration “will significantly impede scientific and technological innovation,” Huawei said in a statement.

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