Daily Management Review

For The Second Year In A Row, Huawei Earns More From Patent Royalties Than It Paid Out


For The Second Year In A Row, Huawei Earns More From Patent Royalties Than It Paid Out
Huawei officially said  late Thursday that it will generate more patent income than it pays to other companies for their patents for the second consecutive year in 2022, as it seeks to offset the impact of U.S. export restrictions on hardware sales.
According to Steven Geiszler, Huawei's chief intellectual property counsel in the United States, the company signed or renewed over 20 patent licensing deals this year. Several automakers, including Mercedes-Benz, Audi, Porsche, and BMW, announced licensors on Thursday.
"By getting a return on our R&D investment, it allows us to re-invest and re-invent," Geiszler said, referring to research and development.
"Audi respects the intellectual property of third parties and is willing to take licences, if such licences are necessary and available to comply with the law," the German automaker said.
There were no comments on the issues from other automakers .
Huawei also announced that it had extended its patent agreement with its Finnish rival Nokia, which began booking licensing revenue from Huawei in 2017.
Nokia earned 1.5 billion euros ($1.59 billion) in revenue from patent licensing in 2021, while Huawei earned $1.2 billion globally from licenses in the three years ending 2021, or hundreds of millions of dollars per year, according to Geiszler.
Its full-year sales figures for 2022 will not be available until next year, and the licensing unit's profits and losses are not tracked separately, he explained.
These figures are insignificant in comparison to the billions of dollars in annual sales Huawei has lost as a result of US restrictions on Chinese technology implemented in 2019 that have harmed its ability to sell in places like the United States and Europe.
However, over the last two years, the company has become more aggressive in striking deals for its patents in order to make up some ground. Furthermore, in some cross-licensing agreements where money was never exchanged, Huawei is now receiving cash to balance out the deals because it is selling fewer devices that use the patents it had secured.
The patents are not subject to US restrictions because they are publicly disclosed technology, according to Geiszler.