Nomura Securities Quick Note - Huawei Meeting Highlights: Communication Equipment/Device Markets Implications
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Rating Summary:
32 Buy, 15 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 24 | New: 24
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Nomura Securities Quick Note - Huawei meeting highlights: Communication equipment and device markets implications
Nomura's China Communications Equipment analyst, Leping Huang, attended a Huawei investor meeting and some highlights include:
1) Aggressive targets by 2015: aiming to be the top handset vendor globally and growing its enterprise revenue fourfold during that period;
2) The company will attack the mobile enterprise market, while easing off on its more established mobile infrastructure segment.
3) Huawei has noted it’s mainly targeting Cisco (Nasdaq: CSCO) in the enterprise, using its gross margin advantage to compete aggressively on price and channel recruitment, but given Huawei’s limited presence in the enterprise today, we believe the financial impact on Cisco will be limited at least for the next couple of years.
To conclude, Nomura analyst, Stuart Jeffrey said, "While not explicitly stated, we believe Huawei is likely to be less aggressive in the carrier equipment market to help support its aggressive pricing efforts in the handset and enterprise segments...We believe this benefits its key competitors in the space, like Ericsson (Nasdaq: ERIC), Alcatel-Lucent (NYSE: ALU), and Nokia Siemens (NYSE: NOK)(NYSE: SI)."
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Nomura's China Communications Equipment analyst, Leping Huang, attended a Huawei investor meeting and some highlights include:
1) Aggressive targets by 2015: aiming to be the top handset vendor globally and growing its enterprise revenue fourfold during that period;
2) The company will attack the mobile enterprise market, while easing off on its more established mobile infrastructure segment.
3) Huawei has noted it’s mainly targeting Cisco (Nasdaq: CSCO) in the enterprise, using its gross margin advantage to compete aggressively on price and channel recruitment, but given Huawei’s limited presence in the enterprise today, we believe the financial impact on Cisco will be limited at least for the next couple of years.
To conclude, Nomura analyst, Stuart Jeffrey said, "While not explicitly stated, we believe Huawei is likely to be less aggressive in the carrier equipment market to help support its aggressive pricing efforts in the handset and enterprise segments...We believe this benefits its key competitors in the space, like Ericsson (Nasdaq: ERIC), Alcatel-Lucent (NYSE: ALU), and Nokia Siemens (NYSE: NOK)(NYSE: SI)."
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