Huawei Names New Cloud and AI Head as Smartphone Business Struggles

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Huawei logo in courtyard

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Huawei has selected Richard Yu to lead the company’s cloud and artificial intelligence unit, according to sources cited by CNBC. Yu is currently the head of Huawei’s consumer smartphone business and will officially take on his new role on February 7, 2021.

Yu is a veteran Huawei employee who was responsible for its quick ascent to become one of the world’s top smartphone vendors, rivaling the likes of Samsung and Apple. The company likely hopes Yu can work his magic at the company’s budding cloud and artificial intelligence business, as it makes an effort to widen alternative revenue streams to fill the hole left its now declining smartphone business.

The company’s core smartphone business took a hit due to US sanctions, which blocked its ability to acquire US-made smartphone chips and limited its production. Huawei shipped just 33 million smartphones globally in the fourth quarter of 2020, a 41% year-over-year decline. The sanctions, quickly took their toll on Huawei, and in November 2020 the smartphone giant was forced to sell off its budget brand, called Honor. Huawei is also rumored to be looking to sell its premium smartphone business as well — a claim the company denies.

Now Yu will lead the company’s cloud and AI business, which has been flagged as a priority for the company because the unit still has access to US-made chips. Additionally, in May 2020 the company earmarked an extra $200 million in funding for the cloud division to facilitate its growth. Despite the increased resources, Yu will have his work cut out for him as Huawei trails established rivals like Alibaba and Tencent, who are considered the leaders in China’s fast-growing cloud market.

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