China's Huawei posts 25 pct rise in 2018 profit on smartphone sales

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Huawei announced its results a day after the British equivalent to the U.S. National Security Agency released a scathing assessment of the security risks the Chinese company posed to Britain's telecom networks.

It notes "no material progress" on issues raised a year ago and warns that it can offer "only limited assurance that all risks to United Kingdom national security from Huawei's involvement in the UK's critical networks can be sufficiently mitigated long-term".

Huawei, the biggest global maker of switching gear used by phone and internet companies, denies US accusations it facilitates Chinese spying.

The agency said in a report British researchers saw no sign that was due to Chinese government interference, but it said Huawei had not repaired flaws that might make its systems vulnerable to cyber attacks.

Separately, China's commerce ministry said on Thursday that Japan's decision to curb government purchases from Huawei and ZTE Corp could hurt bilateral ties if Tokyo's actions are deemed unfair.

Profit rose 25.1 per cent to 59.3 billion yuan ($8.6 billion).

Last month, Huawei fired back at the criticism and sued the USA government, claiming it failed to produce evidence to back up concerns that the company poses a security threat and said that its law is unconstitutional. "Throughout this process, Huawei will continue to strictly comply with all relevant standards to build secure, trustworthy, and high-quality products".

The performance of consumer business was in line with what Huawei flagged in January, when it also said it could become the world's biggest-selling smartphone vendor this year. Huawei's patent filings in the USA, like other Chinese tech and telecom companies, reflect steep growth in research and development investments amid a government-led push for global technological leadership.

The telecoms equipment manufacturer's revenues grew almost 20 per cent, crossing the $100 billion mark for the first time, the company reported on Friday. Unless this is fixed, Huawei could potentially provide a "clean" version of its software for review and a backdoored one for use in telecommunications equipment.

Other government representatives as well as individuals from Huawei and companies that use Huawei equipment also sit on the oversight board.

He also hinted that Huawei's market dominance made it a crucial player in the global 5G rollout that could not be sidelined.

Global revenue for the Shenzhen-based firm climbed 19.5%, surpassing US$100 billion for the first time to hit 721.2 billion yuan (US$107 billion) last year, marking its fastest pace of business growth in two years.

Despite the success, the company is now under intense scrutiny over Chinese government security concerns.

The board was established in 2010 and is used to monitor Huawei's security risks.

If Huawei has a security problem, what exactly is it?

Ironically, Huawei does receive some praise for being good at reverse engineering issues to find their root causes despite having a horrendously unorganized product development process.