Huawei’s 2022 Dividends Exceed Employee Expectations
Huawei’s dividend plan for 2022 emerged on January 14 within the tech giant’s internal forum, showing that they are expected to be 1.61 yuan ($0.24) per share, an increase from 1.58 yuan last year. The virtual restricted stock price is expected to be 7.85 yuan per share, which also means that the dividend yield of the firm’s internal shares is 20.5%. Huawei insiders confirmed that this plan is true.
Ren Zhengfei, the founder of Huawei, delivered an internal speech in August 2022, saying that Huawei should change its thinking and business policy from pursuing scale to pursuing profits and cash flow, so as to ensure that it will survive crisis in the next three years. The firm also needs to take survival as the most important goal, shrink or close its edge businesses, and put pressure on all staff.
As for Huawei’s dividend plan during this difficult transition period, many employees have said that it exceeded expectations. “Thanks to the company and the boss. It has greatly exceeded my expectations in such a difficult situation, wrote one. “It’s awesome… This year is too hard and it is worth it,” said another. Finally, another employee wrote, “To be honest, it is higher than most of us predicted. Even one yuan is okay for us.”
According to Huawei’s 2021 annual report, the firm is a private enterprise 100% owned by employees. Shareholders are Huawei’s trade union committee and Ren Zhengfei. The company has been implementing an employee stock ownership plan. The number of participants was 131,507 as of December 31, 2021, all of whom were on-the-job employees or retired staff.
Since Huawei is not listed publicly, employees get dividends by holding internal virtual shares, which is also an important part of Huawei executives and employees’ income. At present, Huawei employees’ salary mainly includes three parts – basic salary, bonuses and dividends. From 2018 to 2021, Huawei’s dividends per share were 1.05 yuan, 2.11 yuan, 1.86 yuan and 1.58 yuan respectively.
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Huawei has been fighting for survival in recent years because of sanctions imposed by the the US. However, Eric Xu, the firm’s rotating chairman in 2023, conveyed more positive signals in a recent speech. “In 2022, we successfully pulled ourselves out of crisis mode. US restrictions are now our new normal, and we’re back to business as usual. 2023 will be the first year that we return to business as usual with external restrictions still in place. It will be a crucial year for us,” said Xu.
Xu expects Huawei to achieve sales revenue of 636.9 billion yuan in 2022, reversing a previous decline in revenue and slightly increasing compared with 636.8 billion yuan in 2021.