You're listening to Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. So some news came out early this morning. Whahwei Technologies their net profits surging see despite deep revenue declines across its business, all reflecting efforts to shave costs and really rely on home grown components to whether the fallout from American sanctions.
The Chinese networking and smartphone giant unveiling its annual results at a briefing presided over by its CFO, who meets media for the first time since her September release from three years of house arrest in Canada. There's a lot going on in a lot to unpack with our next guest, Maaty Purdy, is Chief security officer at Huawei Technologies USA. Joins us via Zoom from College Park, Maryland, from Washington. See rather, uh Andy, it's good to have you back
with us. How are you? Thank you? It's good to be here. It's been that crazy time, Yes, it really has. Hey, Um, we'll get to the results in a few minutes. I do want to start though, with Russia's invasion of Ukraine and and really try to understand and because we've seen so many multinational companies pull out of Russia UH and stop doing business there as a result of what happened more than a month ago and continues to this day. UM, where is where is Huawei when it comes to doing
business in Russia? Well, our rotating chairman while paying on the press conference earlier today, so that while we're studying the policies of different countries and regions of the world, UH, and he is not yet in a position to make an announcement about whether we're going to continue to do business. We very much value our business in Ukraine and having
been there, it's a it's an unbelievably terrible situation. I hope we can go to ceasefire soon and and bring back to children and the people that had the fleet. No absolutely, UM, and give us an idea of how much business you guys do in Ukraine, how much business you do in Russia? How important are those markets? You know? I don't have a number right now, We'll have to get that for for another time, UM. But we have been focusing on a hundred and seventy countries in the world.
In fact, I recently you know, a couple of years ago before the pandemic. I went to Moldova before when the Romania, Moldova being west of Ukraine, and I was in Kieva twice in so the size of the country, the amount that we make doesn't matter. We really are trying to do business where people are willing to do business with us and where we can bring value to our partners and to our customers. Uh, that's where we
can get some value ourselves. So uh, it's uh, it's it's a very difficult, trying time and hopefully we can get to a better place soon. What about when you know one thing that we've talked a lot about on the program over the last six weeks or so, uh Andy has has been the tech talent in both Russia and Ukraine. And I know that Lahwe has made a lot of robust hires in Russia, recruiting a lot of engineers there. Um, what do we know about those engineers
and plans to hire more in Russia. Yeah, we're trying to get to take stock of what this situation actually is. Our communications is not what we might like. Um. We certainly have hired globally a tremendous number of new employees and engineers, and and the quest for talent is a is a fundamental thing that is critically important us in
other companies. But we do under andy, like in terms of I understand it's probably very difficult to get the lay of the land considering what's going on in Russia in terms of any kind of hiring you want to do. But what is the position in terms of the hiring you are looking to do and how aggressively you know you are continuing with those plans or has that change? Are you considering pulling back because of the current conditions and geopolitical problems. I haven't seen anything yet on uh
the impact on on hiring. Be very surprised if there isn't an impact, But that that's something we just don't have information on right now. What is the exposure though? Can we get an idea of how much you know, in terms of the business you guys are currently doing there. I know you can't give market size, but how big is the team there on the ground. I mean, you guys are global I know there's back and forth. Globalization means we all have to be you know, a company
has to be talking to its different divisions. How big is the team on the ground in Russia. I'm sorry, I don't have numbers on how many people we have here beyond what you reference in terms of people that we hired there, so I'll have to get back to you on that. I'm wondering about, you know, potential contingency plans for sanctions on Russia or or sanctions were if they were imposed on China. Have you have you been
able to talk through any contingency plans there? Well, our focus has been business continuity generally around the world with the challenges that we faced with the pandemic and the impact on the on the global supply chain. Uh, and trying to make sure that we can have a diversified supply chain so that we can meet the needs to meet the needs of our customers. UH. So we we we need more information and uh, you know, we're trying
hard to to get it so Andy. You know, I feel like one of our big stories, you know, and I don't need to sugarcoat it is all about semiconductors in demand and you know how this the pandemic and what's going on right now is impacting kind of global supply chains. Talk to us a little bit more about what your plans are, what we always plans are in
terms of chip making. UM, you know, we have ideas about you guys, I think weaning yourself off American Latin latent chips, finding ways to get more out of mature technology. Give us, give us some ideas of what the plans are going forward. Well, we've been impacted tremendous ease. You know why, our inability to get the chips for our consumer mobile devices. UH, and so that has caused the
gigantic hit in our revenue. They're fortunately our five jeep business, we're able to use the less sophisticated chips to to to maintain that business. We have been emphasizing trying to improve our our product portfolio. We've managed to make our operations and in five G and telecom stable. UH. We're fortunately able to meet the demands. And I think there was a study that came out recently of Whilways five G and in thirteen different countries that were we provide
the best user experience. Our enterprise business has has drown dramatically with digitization. UH. That's affecting UH, individuals and organizations around the world. We've we've been chosen by seven hundred cities and two hundred and sixty seven of the Fortune Global five companies to be their digital transformation partner, and we have six thousand service and operation partners doing that
around the world. We're also investing heavily, and I'm sure you saw over of our revenues we invested in R and D, which is an extraordinary number. Heavily invested in in some pure research, trying to figure out how to make the connectivity better, how to reduce energy consumption using digitization of energy has been a major thing that we're trying to do to help the I c T industry. You need the car numbers for UH AND and we
feel like we're making tremendous progress on that. Part of that is not just generating in power, but it's storage and the availability of the storage too. When when you can't get the sunshine that you can you can have the energy. So we're talking with Andy Purty, he's chief security officer at Huawei Technologies USA, joining us via zoom from College Park, Maryland. Hey, Andy, to go more with chips. I mean, because this is the story when it comes
to supply chain, at least for tech companies. In two UH a story in on Bloomberg just a couple of weeks ago, continues to talk about the way times for semiconductors just rising again. In February, assigned that the shortages are continuing for chip buyers in a wide range of industries twenty six point two percent weeks last month, according to Susquehanna Financial Group. So where exactly are you going
to be able to go to get chips to satisfy demand? Well, we are working hard to help push the limits on the foundational technologies UH that underlie semiconductors, not that we're going to manufacture them ourselves, but trying to make some some great progress in some of the scientific theories in the world to increase capacity and the capabilities of less sophisticated different kinds of chips, different kinds of technologies to
allow uh the network and communication devices to function. We've hired a number of experts from around the world, scientists to impure research UH, and we feel like we're making some very important progress, and we're participating in the in the public collaborations with experts around the world on that.
So we hope that's going to bear some very significant fruits in terms of architecture, computing architecture and software performance, UH and the ability to store energy and create more energy and use a lot less energy in the information and communications technologies. Hey, Andy, you know you're there in in uh, you know, College Park, Maryland, not too far from d C. And I'm thinking about you know, President Biden putting out his budget today and he talked a
lot about security as well. What is Huawei doing. What are the conversations that you are having uh with the higher ups when it has to address when it has to address specifically the security concerns raised by foreign countries, particularly the United States, which, as you said, and we know is really you know, crympt what Huawei can do well. The United States has been unwilling to talk with us
for quite some time. So we're encouraging the United States to get involved in the international standards efforts that are going to help contribute to a safer cyber space. We've offered to open up our facilities to have government officials from the United States and elsewhere to command to see what we can do, what our competitors can do to be more effective, to be more resilient, and frankly, to to be more transparent. We are working with the industry
organizations and standards bodies to create a safer cyberspace. Uh and that requires some some hardcore work in terms of setting requirements and learning lessons from these cyber attacks. In the last year or so, the idea of so called notion of trusted suppliers is no longer any good. We saw the taxes. Do you anticipate any forgive me for jumping in because we've only got about a minute left,
I mean, is it likely to get any better? But we're not fundamentally concerned about being able to do business United States. We hope that we can help share what can benefit the United States, whether it's from US or others. What is fundamentally important is to grow the ability of American government and organizations critical infrastructure to defend themselves. And
we think we can share some experience in that. Do you think because of China's reluctance to condemn Russia is only going to complicate the relationship between US and China, especially on something like the tele telecommunications or technology. Well, there an awful lot of people in the world that hopefully United States is going to collaborate with to to help improve our defenses. Uh and to try to improve the quality and nature of information sharing about private companies
and government agencies. And we're happy to be as transparent as possible to help contribute to those dialogues, contribute to coming up with an objective and transparent basis for knowing which products and services are worthy of trust and which ones are going to be resilient. All Right, we're gonna leave it there, uh Andy, thank you so much. Andy Purty is chief Security Officer at Wahwei Technologies USA, joining us via Zoom from College Park, Maryland.