Huawei: Ren Zhengfei's Rural Switches, Meng Wanzhou and the Mate 60 Pro

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Ren Zhengfei, a former People's Liberation Army engineer, founded Huawei in Shenzhen in 1987 with about 21,000 yuan, roughly $5,000. The name came from a wall slogan meaning roughly "China has achievements," and the company later ran a campaign teaching foreigners to pronounce it rather than rename itself. Early investors walked away while Huawei imported PBX telephone switches from Hong Kong, reverse engineered them and resold them. Shut out of big cities by Alcatel and Nortel in 1992, its sales teams worked rural villages, and in 1993 it built its own programmable switch. In 1994 Ren told Jiang Zemin that depending on foreign telecom equipment was like a nation lacking its own military; by 1996 the state was restricting foreign competition. Abroad, Huawei started in Africa and the Middle East, backed by a $30 billion China Development Bank credit line for vendor financing, and passed Ericsson in 2012 as the largest telecom equipment maker.

Western governments questioned its employee "virtual share" ownership and cited Chinese intelligence laws from 2014 and 2017 that can compel cooperation; Huawei has consistently denied spying. Between 2018 and 2020 the U.S. accused Huawei of violating Iran sanctions, CFO Meng Wanzhou, Ren's daughter, was detained in Canada at U.S. request, Five Eyes countries pulled Huawei from 5G networks, and the foreign direct product rule cut off chips made with U.S. tools along with Google's Android services. Huawei stockpiled parts and built replacements. The 2023 Mate 60 Pro carried a domestic processor made on older deep ultraviolet machines through multi-patterning, and first-quarter 2024 profit rose nearly sixfold.

• Huawei's Rural Star program used solar-powered cell stations to connect off-grid villages.
• State-backed financing let Huawei underbid rivals by up to 70 percent, and it supplies around 70 percent of Africa's 4G networks.
• Virtual shares pay employees dividends but carry no voting stock recorded in a public registry.
• After the bans, Huawei's international smartphone sales collapsed and analysts called its consumer business dead.
• By mid-2024 HarmonyOS ran on more than 900 million devices and had passed iOS as China's second most popular mobile operating system.