Multinational company Huawei Technologies Co., Ltd. on Friday said that it expects its smartphone business to lose up to $40 billion in revenue this year.

“Our revenue from the smartphone business last year was around $50 billion. This year that number would at least drop by $30 to $40 billion,” Huawei Rotating Chairman Eric Xu said at a virtual media briefing.

Mr. Xu said the company’s revenue from its fifth-generation (5G) technology initiatives in coal mining, airports, and other industries “can certainly not compensate for the revenue loss of the handset business.”

“Even those revenues throughout the 10 years combined cannot compensate for the declining revenue of the handset business,” he noted.

He also said it would take a long time for Huawei to make up for the $30-$40 billion reduction by deploying 5G technologies in different sectors.

“And yet, why are we still working on 5G and AI (artificial intelligence) and [promote their use] in different sectors? First, of course, those businesses can upgrade revenues… for Huawei. Second, …we have the hope [that] 5G will create value for different sectors,” Mr. Xu continued.

The company’s annual flagship event for the global information and communications technology industry – Huawei Connect 2021– kicked off on Thursday.

“This year’s event, themed ‘Dive into Digital’, explores how digital technology can better integrate with business scenarios and industry know-how to address critical business challenges, and how stakeholders can work together more effectively to foster an open industry ecosystem and drive shared success,” Huawei said in a statement.

In his keynote, Mr. Xu said: “Digital development relies on digital technology. For digital technology to stay relevant, we must continue to innovate and create value. Cloud, AI, and networks are three critical digital technologies.” — Arjay L. Balinbin