Huawei New Zealand operation posted a slightly lower profit for the year to December 31, 2018 - $5.0m vs the year-ago $5.7m, according to accounts just filed.

Revenue increased by 25 per cent to $189m, but was paced by an increase in costs.

The Chinese telecommunications giant had tax expenses of $2.1m in 2018, vs $175,000 the year before.

There have been big oscillations in Huawei NZ's revenue. In 2017 it booked $151m; in 2016 $180m.


Huawei maintains between 150 and 200 full-time equivalent staff in NZ, with the number ebbing and flowing with contract work, deputy chief executive Andrew Bowater said.

Huawei's network infrastructure gear is used in around one-third of the Ultrafast Broadband (UFB) rollout, and it is also a primary technology partner for Spark and 2degrees with their 4G mobile networks.

"We had another strong year of sales growth. This was particularly true for our consumer division, with our sharpened focus on higher-end devices the P20 and P30 and Mate series," Bowater said.

The financial period included the November 28 political shock of the GCSB blocking Huawei from Spark's planned 5G mobile network upgrade. However, any commercial impact from that decision will be down the track, with 5G upgrades not due to begin until early to mid-2020. Spark is still assessing whether to submit a revised proposal.

It did not include a White House move to block US companies from supplying technology to Huawei, which was announced last month, with security concerns cited.

The ban does not affect existing Huawei phones, which run on Android software from US company Google, and reply on Google's app store and services for full-functionality, and include hardware from US chipmakers including Intel, Broadcom and Qualcomm.

But if the ban stands, it is expected to affect future models.

Huawei deputy chief executive Andrew Bowater said


Bowater highlights that no evidence has ever been tabled of his company being involved in espionage, and maintains it is being used as a political football.

Whichever narrative is correct, Huawei NZ's financial fortunes over the next 12 to 24 months will depend as much on the Trump Administration and the as whatever plays it makes in the local consumer market.

While work on Spark and 2degrees' 5G mobile network upgrades still hangs in the balance, Vodafone NZ chief executive has ruled out the Chinese company from his company's next-generation build.

Chief executive Jason Paris said told the Herald he hoped technical and political issues could be separated in the Huawei debate - but also that it was not a discussion his company was not involved in. Vodafone NZ was happy with its 4G network partner Nokia Networks (formerly Nokia Siemens) and would stick with it for its 5G network upgrade. The move was expected.

Spark boss Simon Moutter earlier told investors that Huawei was his company's preferred 5G partner, but also that it could hit its July 1, 2020 launch date by using other vendors' gear if necessary.

Of the handset market, Paris said "All existing Huawei devices are as good as gold - you don't need to worry about them. All the ones that are in stores at the moment.

"The ones that are coming through though, in the next months - that's the time you'll need to take a bit more care on making a decision on whether you buy a $2000 Huawei or an alternative."

At the moment, the situation is changing every day, Paris said.