SHENZHEN (Reuters) – China’s Huawei Technologies reported on Thursday that its first quarter revenues fell 13.9% compared to a year ago. New business areas are still needed in order for the company to recover from its declining fortunes due to being on a U.S. sanction blacklist.

Chinese telecoms giant China posted revenue of $13 billion ($19.9billion) in its first quarter. That’s down from $152.2 billion yuan last year, when it was already suffering damage to its dominant handset business.

According to Ken Hu (Hawk’s rotating chairman), the results were consistent with expectations.

Hu stated, “Our consumer business suffered greatly and our ICT infrastructure business saw steady growth.”

Huawei was placed on the U.S. export blacklist for 2019, which prevents it from accessing U.S. critical technology. This hinders its ability to source chips from other vendors and design new ones.

According to a spokesperson for Huawei, the company is taking steps to satisfy consumer demand.

According to the spokesperson, “Consumers are able to purchase Huawei smartphones faster now, including the most popular models,” like the flagship P50 or Nova series. He did not provide further details about chip and component supplies.

Counterpoint Research has revealed that Huawei held 6.2% in China’s smartphone market during the first quarter.

Honor’s market share grew to 16.9% in the same quarter. This was a Huawei unit that was sold December 2020.

Huawei’s net profit margin for the quarter was 4.3%. That is 6.8% less than a year before. The company said that this drop was caused by increased investment in research and technology, and also the decrease in revenue.

The company spent 142.7 billion yuan, or 22.4% of its total revenue, on R&D, it said in its 2021 annual report last month.

Hu revealed that Huawei is focusing on helping businesses use cloud computing, 5G technology and energy efficiency to boost revenues.

($1 = 6.5890 yuan)