Huawei will pay out Rmb2bn ($286m) in bonuses and double almost all employees’ monthly salaries for October as a reward for helping the world’s largest telecoms equipment maker counter US sanctions imposed by the Trump administration.
In May, the US barred the Chinese company from buying crucial semiconductors from suppliers including Qualcomm and banned it from using Google’s Android operating system in its smartphones, citing worries the group poses a national security risk.
Washington views Huawei as a potential spy on behalf of the Chinese government, an allegation the company denies.
Huawei, which employs about 190,000 people, will disburse Rmb2bn to employees working in the team focused on minimising the impact of US sanctions through research and development as well as finding new supply chains, according to four Huawei employees.
It is not unusual for Huawei to reward its employees with cash incentives. However, “this 2bn [renminbi] bonus is enormous, especially considering it’s only being allocated to one team”, said one of the employees who works for the company’s consumer business.
That team has been at the forefront of efforts to redirect reliance on overseas component suppliers towards domestic ones including Huawei’s own HiSilicon semiconductor company and its proprietary Harmony OS operating system.
“At most 20,000 people will share the Rmb2bn bonus,” said the employee who is a member of the consumer business, and who viewed an internal document outlining the award.
In addition, Huawei will pay most employees, excluding any who have received poor performance reviews, an additional bonus of one month’s salary this Friday, according to an internal email seen by the Financial Times.
Huawei confirmed the authenticity of the two documents but declined to comment further.
The bonuses were timed to coincide with Singles Day, China’s 24-hour online November 11 shopping bonanza that is similar to Black Friday or Cyber Monday in the US. The annual event this year generated more than $38bn of sales on Monday.
“This year’s revenues are much better than expected so we’ve heard we will all get bonuses earlier than expected,” said an employee in Huawei’s finance department.
Ren Zhengfei, founder and chief executive officer, last week estimated that Huawei was on track to sell 240m-250m smartphones in 2019, up from 206m in 2018. Its smartphone sales have been buoyed by higher sales in its home market, where Google services are already blocked.
Shrugging off the US sanctions, the Chinese company reported revenue of Rmb610.8bn for the first three quarters of this year, with sales rising 27 percent over the same period last year.
However, there was some speculation the bonus plans masked concerns about the company’s outlook.
“Although the numbers are very good this year, our bosses are concerned that next year we will face even greater challenges,” said the employee working in Huawei’s consumer business. “We’re very worried about sales in the overseas consumer market.”―Financial Times