Seeing people gloating and spreading the news on social media about Huawei’s profit decline and cash flow turning from positive to negative this year, I feel it’s necessary to say a few more words in support of Huawei.
Huawei has truly had a tough time. Not only does it face sanctions from the US and its allies, but it also faces public pressure from the “special treatment” it receives on the Chinese internet. If there were a contest for the most challenging Chinese company, Huawei would undoubtedly be the most competitive.
Huawei is the Chinese company most severely suppressed by the United States. In terms of the breadth, depth, targeting, and escalating intensity of the sanctions, the pressure Huawei faces is undoubtedly the most severe, comprehensive, and systematic of all US-led crackdowns on Chinese companies. Not content with using its national power to block Huawei, the US also pressures its allies to join in the suppression.
The reason the United States is suppressing Huawei with such unprecedented force is because Huawei is a Chinese company that spans multiple key areas, including hardware and software, such as communication equipment, smartphones, chips, operating systems, databases, and smart cars. It also challenges the core interests of several major US tech giants, directly competing with at least Cisco, Apple, Qualcomm, Nvidia, Intel, Google, Microsoft, and Tesla. In short, Huawei has single-handedly challenged half of the US’s technological hegemony.
From chip design to operating systems to databases, Huawei often enters fields with the highest technological barriers, the strongest international giant monopolies, and those crucial to the future of industry. Breakthroughs in these areas require not only a clear and long-term technological vision, but also substantial long-term financial investment and a large, efficient R&D team, posing a significant challenge to a company’s financial strength and organizational capabilities. Huawei’s R&D investment ranks first among Chinese companies, far ahead of others, and is also among the top globally. According to the European Commission’s ” EU Industrial R&D Investment Scoreboard 2025,” Huawei ranks sixth globally with €22.94 billion in R&D expenditure, making it the only Chinese company among the top ten global R&D spenders.
In short, Huawei has tackled most of the tough challenges that other companies are unwilling to engage in due to concerns about investment, returns, and risks. If domestic substitution cannot be achieved in these areas, they could very well become key targets for the United States to use in its technological war against us and to strangle us.
Huawei is not only the undisputed leading company in China’s counterattack against the US technology war, but also a core force bearing the greatest pressure, shouldering the heaviest tasks, and achieving breakthroughs of the most significant overall importance in this game. Although the US technology war has been largely unsuccessful and is drawing ever closer to its ultimate defeat, the US’s choice of Huawei as a key target in its technology war against China demonstrates strategic foresight, and Huawei’s role is irreplaceable. If Huawei falls victim to US sanctions, it will significantly impact China’s confidence in countering the US technology war, leaving gaps that other companies may not be able to fill in the short term. Moreover, if even Huawei cannot withstand the pressure, other Chinese private enterprises will have greater concerns about entering areas that may be under US scrutiny, and will likely choose more conservative technological development paths to avoid US sanctions.
Conversely, if Huawei withstands the immense pressure of US sanctions and achieves a breakthrough against the odds, it will not only provide a significant spiritual boost to other Chinese companies, overcoming the long-standing subconscious “glass ceiling fear”—the reluctance to surpass in core areas such as chips, operating systems, and high-end software, leading to a willingness to follow and adhere to Western-set rules—but also drive the “rise of the entire supply chain” through Huawei’s “single-point breakthrough.” This will create more space for survival and development for upstream companies in domestic semiconductors, software, and materials, accelerating the domestic substitution of domestic technologies and enabling China’s high-tech industry to more quickly develop systemic resilience. For example, at a critical moment when Apple’s supply chain selectively excluded Chinese companies, the return of Huawei’s 5G phones injected a “strong boost” into the domestic mobile phone industry chain. During the years when Huawei’s mobile phone sales plummeted due to US sanctions, Apple phones monopolized the domestic high-end mobile phone market and had a strong influence on the industry chain. It has been proven that the technological advancement of the domestic mobile phone industry chain can only be driven by high-end mobile phone brands, a mission that only Huawei can shoulder, and only Huawei possesses the strength to compete with Apple domestically.
Huawei’s HarmonyOS has grown into the second-largest mobile operating system in China and the third-largest globally. According to data from the Ministry of Industry and Information Technology and related market research institutions, in the first quarter of 2026, HarmonyOS held a 19% market share in China, surpassing iOS to rank second domestically; its global market share was approximately 5%. As of August 20, 2026, the number of terminal devices running HarmonyOS 6 had exceeded 80 million, and by the end of the year, it would surpass the critical scale of “100 million mobile phone users.” HarmonyOS is evolving from an operating system into a vast industrial ecosystem. The number of native applications has exceeded 100,000, covering mainstream daily applications. In the future, HarmonyOS will become the digital foundation for the Internet of Things.
Huawei’s Euler operating system supports various scenarios such as servers, cloud computing, and edge computing, and is positioned as a “unified software foundation for digital infrastructure”.
Huawei Cloud GaussDB database adopts a native distributed architecture and is positioned as “a new intelligent data foundation for the AI era”.
Huawei is building a computing power foundation for artificial intelligence, using the Ascend AI chip as the hardware core and CANN as the software foundation, making it a core infrastructure for the independent development of China’s AI industry.
As for Huawei’s leading position in its original business of telecommunications, there is no need to analyze it further.
In summary, Huawei is building a full-stack technology system of “chips + operating system + database + AI computing power + communication network”. Through systematic technology layout, it is transforming itself to provide a “foundation” for the entire Chinese digital economy, so that China has “Chinese solutions” in every key link such as computing power, operating system, database, AI and communication without relying on external technologies.
Therefore, Huawei has stood firm and become stronger in the face of the pressure of comprehensive sanctions imposed by the United States, becoming a leading enterprise in China’s counterattack against the US technology war, and its role in the Sino-US technology war is irreplaceable.
Double Standards in Public Opinion: A Phenomenon Worthy of Warning
From the perspective of a Chinese person with a normal stance and understanding, it’s understandable to have various dissatisfactions with Huawei, because Huawei is not perfect and has its own problems and shortcomings. For example, there may be areas for improvement in product pricing strategies, marketing rhetoric, and internal management. These are all within the scope of reasonable questioning or criticism. However, holding an irreconcilable hostile attitude towards Huawei is outside the normal range. Those who overflow with irreconcilable hatred for Huawei in their words can only find a reasonable explanation in terms of their stance.
Americans are hostile to Huawei because they stand on the American side. After all, Huawei is a representative of Chinese companies that challenge American technological hegemony. So, the overwhelming hostility some Chinese people have towards Huawei can only be said to be because they have not chosen the Chinese side.
A noteworthy phenomenon is that whenever negative information about Huawei emerges—whether it’s product defects, market share fluctuations, or changes in financial indicators—certain media outlets and accounts amplify it with remarkable efficiency, turning it into a widely discussed public opinion event. The timeliness, coordination, and agenda-setting ability of this operation far exceed the scope of spontaneous discussion among ordinary netizens. If the US is targeting Huawei’s supply chain and overseas markets, then the actual effect of these public opinion manipulations is to establish a negative stereotype of Huawei within China, shaking its market foundation. Specifically, any negative information about Huawei is amplified, and even when there is no negative information, it is interpreted negatively. When Huawei launches high-end flagship models, it is criticized for being too expensive and exploiting nostalgia; while when Huawei launches the highly cost-effective Enjoy series, it is accused of squeezing out the market space of domestic competitors. In contrast, Apple products, with their higher prices, rarely face price criticism in the same public discourse. This systematic and continuous double standard clearly does not constitute normal business criticism or social media oversight.
Of course, pointing out this phenomenon doesn’t mean attributing all criticism of Huawei to “external forces.” There is indeed a large amount of well-intentioned criticism on the Chinese internet based on genuine experience, and such criticism is necessary for the progress of any company. What we really need to be wary of are those media manipulations that feature highly consistent agenda-setting, highly polarized emotional expression, selective blindness to positive information, and an unlimited amplification of negative information. There is a clear line between these two.
The existence of such public opinion forces is largely due to the fact that America’s media hegemony is not only manifested in mainstream media and platforms directly controlled by the US, but its influence and narrative framework also extend to the world through various channels. Some people do not simply “love America more than China,” but rather have cognitively accepted a US-centric narrative system, and therefore also harbor hostility towards leading Chinese companies that challenge US technological hegemony. Some of them may even appear as supporters of domestic competitors, packaging the Sino-US conflict in the cognitive war as commercial competition between domestic companies, thereby increasing the deceptiveness of their views.
Of course, the only reason why Huawei’s challenge to the US’s technological hegemony is easily met with criticism is that Huawei has also challenged the rules of the game dominated by capital.
Many of Huawei’s strategic moves challenge the very nature of capital. While listing a company on the stock market is a shortcut for many startup founders to quickly achieve immense wealth, Huawei has remained committed to not going public. Ren Zhengfei explains this by saying, “The capital market is inherently greedy. To some extent, not going public has contributed to Huawei’s success.” He adds, “The greedy nature of capital can undermine the realization of ideals.”
Unlike some companies that evoke similar sentiments, Huawei hasn’t used “serving the country through industry” as an advertising slogan; instead, it has genuinely put it into practice. To prevent this ideal from being eroded by the nature of capital, Huawei not only insists on remaining private but also maintains a closed equity structure, refraining from opening its doors to external capital. Ren Zhengfei has explained the reason: “Huawei doesn’t easily allow capital to enter, because the greedy nature of capital will undermine the realization of our ideals.”
Ren Zhengfei has also questioned certain theoretical assumptions of Western economics: “Many theories in traditional economics claim that shareholders have a long-term vision, they will not pursue short-term gains, and they will make very reasonable and well-founded investments in the future. But in reality, shareholders are ‘greedy.’ They want to squeeze every last drop of profit out of the company as soon as possible.”
Huawei’s greater challenge to the logic of capital lies in its distribution methods. Huawei’s success, and its challenge to traditional ownership and distribution methods, is likely a more significant reason why some people are hostile towards it.
Huawei has long adhered to the principle of “favoring workers,” with a capital-to-labor ratio of 1:2, later adjusted to 1:3. Since introducing the TUP incentive system in 2012, this ratio has become closer to 1:4, meaning that the capital side’s share has been reduced to 1/5. This is a fundamental difference from many companies that favor capital and suppress employee income.
This labor-oriented distribution method is a core factor in Huawei’s competitiveness. At a press conference in 2019, Huawei’s rotating CEO, Xu Zhijun, was asked, “What is the secret to Huawei’s success?” Xu Zhijun’s answer was: “Good profit distribution.” Ren Zhengfei once said, when answering questions about internal management, “The most important thing is the distribution issue,” and “Our distribution method is three parts labor and one part capital.” This is also why many companies have failed to successfully emulate Huawei’s management model—they demand that their employees learn Huawei’s fighting spirit, but are unwilling to learn Huawei’s labor-oriented distribution model.
Huawei’s “work-oriented” distribution method, in other words, is based on distribution according to work. While it’s easy to say that distribution should be “work-oriented,” it’s difficult to do. Huawei, however, has put its words into practice, not only enshrining it in its Basic Law but also implementing it in its business operations. Few companies can match Huawei’s commitment to this principle; most private enterprises bypass the issue of distribution to build their core competitiveness.
In terms of profit distribution, Pang Donglai is another representative company that practices distribution according to work as its main principle. Around 2000, Pang Donglai distributed 50% of its profits to its employees. Subsequently, this proportion climbed year by year to 80%, and then to 90%. By 2025, the proportion of Pang Donglai’s profits used for employee incentives had reached nearly 95%.
Therefore, although the United States does not regard Pang Donglai as a threat, Pang Donglai is often given special “attention” by some media and accounts.
Huawei’s ability to implement a distribution system based primarily on merit is not only due to Ren Zhengfei’s vision but also related to the company’s unique equity structure. Ren Zhengfei’s personal shareholding has been steadily declining, reaching 0.52% by August 2025, with 99.48% of the shares held by the “Huawei Investment Holdings Co., Ltd. Trade Union Committee.” Through its virtual employee shareholding system, Huawei has achieved a system of shared ownership among employees that shares similarities with but differs from collective ownership, balancing fairness and efficiency.
Pang Donglai, a traditional business in China, primarily operates on a merit-based system. To solidify this system and move away from relying solely on the personal sentiments of its founder, Yu Donglai, in March 2026, Yu announced a distribution plan for Pang Donglai’s 4 billion yuan assets: nearly 3.793 billion yuan would be distributed approximately 50% to the management team and 50% to the employees. Specifically, 8,913 frontline employees received approximately 1.811 billion yuan, while the remaining portion was allocated among the 718-person management team and the 563-person technical team.
Generally, the distribution method should be matched with the specific ownership structure. Most private enterprises adhere to a shareholder-centric approach, and their distribution tends to favor capital, prioritizing shareholder interests. Shareholders should enjoy the company’s operating results through profit distribution. After a company goes public, it focuses more on the stock price, as the stock price directly affects the shareholders’ net worth.
This equity structure and distribution method is more conducive to maximizing the short-term interests of capital and shareholders, and can realize wealth appreciation the fastest, but it is not conducive to solving the relationship between capital and labor, and it is difficult to form a community of interests.
Western economics has long promoted a theory that denigrates the principle of distribution according to work, pits fair distribution against corporate efficiency, and equates fairness with a “one-pot system” and egalitarianism. Huawei in the high-tech sector and Pang Donglai in traditional industries, however, have achieved highly efficient operations by using distribution methods closer to the principle of distribution according to work, realizing a dialectical unity between fairness and efficiency. The success of Huawei and Pang Donglai demonstrates that a distribution system tilted towards workers not only does not reduce efficiency but actually increases it.
If the distribution methods of Huawei and Pang Donglai can be promoted on a social scale, the purchasing power and consumption capacity of the working class will be significantly expanded, thereby promoting a virtuous cycle of production and consumption. In this way, the contradiction between “production expansion and market narrowing,” which has troubled countless economists without a solution, will no longer be an unsolvable problem. Historically, capital-dominated economic systems have repeatedly experienced economic crises because the proportion of social surplus allocated to workers was too low, resulting in limited purchasing power and thus crises of market narrowing and overproduction.
Capital’s overall behavior in distribution is short-sighted and irrational. The “rational man” assumption in Western economics, even if not zero in reality, is extremely rare. In reality, the proportion of companies that can distribute resources in a way that favors workers, like Huawei and Pang Donglai, is not high.
Many business owners are currently struggling with declining consumption and difficult business conditions, but few are delving into the deeper issues that lead to the problem. Without identifying the root cause, the wrong remedy cannot be prescribed. The root of the problem lies in the distribution of wealth, which in turn depends on ownership. Marxist political economy has long pointed out the cause and offered solutions. However, the dominance of Western economics has obscured the root of the problem, focusing only on its superficial aspects. Unable to escape the dogmas of Western economic thought, and unwilling to confront the issue of distribution, they resort to mortgaging future consumption capacity to alleviate the current shortage of effective demand, euphemistically called balance sheet expansion —continuing to expand debt to give more people money to consume more goods and services, thereby driving economic growth. This method of leveraging debt has already been pushed to its limits; from households to businesses to governments, balance sheets have been expanded to the point of being scorching.
Taking the United States as an example, according to the Federal Reserve’s financial account data for the first quarter of 2026 and the New York Fed’s “Household Debt and Credit Report,” the total debt of the U.S. society, including the government, businesses, households, and the financial sector, has reached $115.5 trillion, accounting for 360% of GDP. Excluding the financial sector, the total debt of the U.S. domestic non-financial sector is no less than $82 trillion, of which the federal government accounts for approximately 42%, non-financial corporate debt accounts for approximately 28%, and household and non-profit organization debt accounts for approximately 26%.
Total U.S. household debt has reached a record $21.2 trillion, with an average household debt of approximately $60,600 per person. While the U.S. government can use various means to default on all or part of its debt, U.S. household debt is a very real burden. In the United States, defaulting on personal debt is no small matter; it immediately leads to severe consequences such as damaged credit records, asset foreclosure, and even bankruptcy.
Therefore, the United States has little room left to increase its domestic purchasing power through expanding debt. The same applies to other countries heavily reliant on debt-driven growth. Debt expansion cannot go on indefinitely; once a critical point is reached, the debt-driven model will suffocate and collapse. Using debt as the “master switch” for creating liquidity and generating consumption will eventually fail. Moreover, in terms of the pressure of personal and household debt, we are not far from that critical point. This is not just a problem unique to the United States; it is a common issue faced by almost all countries integrated into the global capitalist system.
No matter how large the debt expansion, it only alleviates the inherent contradiction of “the low income share and insufficient consumption capacity of workers,” merely delaying the outbreak of the crisis rather than solving it. The fundamental solution always lies in improving the distribution structure and increasing the income share and consumption capacity of workers. Debt can provide emergency relief, but distribution is the only way to address the root cause.
Since Western economics became the mainstream, it has been at a loss when faced with this problem. The solutions it can think of are essentially just going around in circles with debt-driven models, the only difference being whether it focuses on household, corporate, or government debt expansion. Under the existing capital-dominated distribution model, the insufficient capacity to pay for creating social demand is a perpetual problem. This problem is unsolvable within a capital-dominated development model; the real solution lies in a higher-level social development model.
The models of Huawei and Pang Donglai are far from perfect, and far from the ultimate solution for future society. They can be seen as transitional forms at the micro level towards a higher social development model. Although their nature is not entirely socialist, they have transcended the capital-dominated logic of distribution. Their commercial success has provided a valuable micro-level model for broader social change, shaking the core myth that “only a capital-centric development model can be efficient” against the backdrop of traditional ownership being elevated to a pedestal.
Huawei and Pang Donglai have transcended the ordinary meaning of capital, becoming outliers among “private” enterprises and serving as a mirror reflecting the opposite of those groups who possess enormous capital yet still call themselves “proletarians” or “people’s tycoons.”
We are living in an era of great transformation, on the eve of the Fourth Industrial Revolution. The replacement of mental labor by artificial intelligence and manual labor by robots is no longer science fiction, but a reality unfolding on a large scale. This technological revolution, combined with traditional ownership systems, is creating an unprecedented structural contradiction. Under the dual impact of artificial intelligence replacing mental labor and robots further replacing manual labor that has not yet been replaced by machines, the ability to create jobs is far less than the ability to replace manual positions. A significant reduction in the number of jobs is inevitable; “many jobs will disappear permanently,” and the number of jobs lost cannot be compensated for by newly created opportunities.
Traditional ownership has always been caught in an unsolvable paradox: capital, on the one hand, pursues unlimited growth, and on the other hand, constantly creates insufficient demand with purchasing power, thus limiting its own realization. When traditional ownership clashes head-on with the Fourth Industrial Revolution, the contradiction between the relations of production and the productive forces cannot be alleviated by patching up reforms. The socio-economic operating mechanism based on traditional ownership will be unable to function properly due to employment problems, and the capital-dominated shell will be burst by the actual productive forces.
Traditional ownership also has a life cycle and cannot exist forever. The arrival of the Fourth Industrial Revolution should be the end of traditional ownership.
These problems cannot be solved by the Huawei and Pang Donglai models alone. They require a comprehensive upgrade of production relations across society, finding a model that can still provide sufficient employment opportunities despite the impact of artificial intelligence and robotic labor substitution. The right to work should be a fundamental human right. Humanity has solved the problem of material scarcity and possesses mature material conditions to address employment issues and the survival pressures on individuals and families. However, within the framework of traditional ownership, a vast chasm exists between the abundant material wealth created by society and individual consumption. Although bridges exist to cross this chasm, their capacity is limited, artificially creating an “intestinal obstruction” between production and demand, leaving the problem unsolvable.
But a change in mindset can open up new possibilities. Human society has already found a solution, exploring and practicing it in the 20th century. While limitations imposed by the material and technological conditions of the time revealed numerous problems, these problems were not inherent to the model itself. In the 21st century, humanity’s technological capabilities and material creation abilities are sufficient to make this model operate more efficiently . With the help of the internet, big data, and cloud computing, humanity is now able to construct a more advanced model.
Huawei may not be the answer for everyone, but it has raised a set of thought-provoking questions for our times: What kind of companies do we really need? What kind of development model? What kind of distribution method? These questions are themselves very relevant.
