Huawei to Boost R&D Budget by $5.8 Billion, Confident to Meet 2020 Financial Goals

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China’s biggest smartphone maker Huawei plans to boost its research and development (R&D) spending by $5.8 billon to more than $20 billon this year, CEO and founder Ren Zhengfei said in an interview with the Wall Street Journal on Wednesday.

SEE ALSO: 2019 Results Show Record Year for Huawei

According to Huawei’s 2019 revenue and the $1.5 billion they put into R&D, the amount they will invest in this section in 2020 is supposed to account for more than 15% of total revenue.

“How to survive as a company is not a problem for Huawei,” said Ren in an interview with South China Morning Post earlier this week. “But it is questionable whether we can keep our leading position in the industry. Huawei won’t be able to lead the world if we can’t develop our own technology in the next three to five years.”

In fact, Huawei’s spending on R&D has already caught up with its global competitors such as Apple, Google and Samsung. According to numbers pulled out by the European Commission, the R&D spending of Samsung and Google in 2018 were 106 billion yuan and 105.5 billion yuan respectively, compared with Huawei’s 101.5 billion yuan. Although Huawei never elaborated on its spending, research on 5G is likely to account for the majority of costs.

Huawei is now facing pressure from the US government on its market-leading 5G network technology, being blacklisted by Washington due to the accusation that their technology is a threat to US national security.

Huawei’s ambition to lead the 5G industry has also been impeded by the coronavirus outbreak, now spreading around the world. However, Huawei has resumed more than 90% of its production and development operations as China slowly returns to work after nationwide closures, Ren told the Wall Street Journal.

He also said he was confident that Huawei could reach its newly adjusted financial goals for 2020 despite the US sanctions and the epidemic.

Huawei will launch its next generation flagship smartphones, the P40 Series, on March 26 at 9 a.m. EST.