Chinese smartphone camera supplier Ofilm Group has rebounded after being ejected from Apple’s supply chain in 2020, reportedly becoming a major contractor for Huawei’s new Mate 60 series.
Ofilm founder Cai Rongjun said the company is “living unyieldingly” despite past challenges, according to a report from Chinese Business Network. While not confirmed, Ofilm told investors recently it achieved breakthroughs in high-end smartphone cameras adopted by leading Chinese brands.
The company’s stock has surged nearly 70% in recent weeks on rumors of a Huawei contract. This comes after Ofilm lost over two-thirds of its value when blacklisted by the U.S. in 2020, leading to the loss of its biggest client Apple.
Blacklisted Over Forced Labor Accusations, Struggling After Losing Apple
Based in Shenzhen, Ofilm was blacklisted by the U.S. Department of Commerce in July 2020 over accusations of using forced Uyghur labor, along with 10 other Chinese firms. This caused the company’s fortune to crumble after becoming a star supplier to Apple in 2017.
Despite being removed from the Entity List in June 2022, Ofilm reported an annual loss of 5.18 billion yuan ($708 million) as it struggled to replace lost Apple business. The Apple contract had fueled Ofilm’s shares surging 11X since its 2010 IPO.
Huawei Smartphone Demand Fueling Ofilm’s Comeback
Now Ofilm appears poised for a comeback thanks to strong demand for Huawei’s new Mate 60 Pro 5G smartphone, which uses an advanced processor despite U.S. sanctions. Encouraged by brisk sales, Huawei raised its second-half target by 20%.
As a major Mate 60 contractor, Ofilm obtains much-needed orders after its sales plunged from the Apple loss. Huawei remains one of China’s most prominent smartphone brands domestically and is aggressively growing market share.
Ofilm’s Capabilities Suit Huawei’s Camera Needs
Ofilm’s camera capabilities and domestic production make it well-suited to supply Huawei’s goals for high-spec devices that rival iPhones and Galaxys. Partners like Ofilm make Huawei less dependent on foreign technology restricted by U.S. sanctions.
Staying Flexible Critical Amid Trade Tensions
Ofilm exemplifies how suppliers must stay agile amid U.S.-China trade tensions that disrupt supply chains and sink sales. Despite pioneering advanced phone cameras, Ofilm saw its huge Apple business vanish almost overnight due to geopolitical issues beyond its control.
Rather than fold, Ofilm leveraged core strengths in optics and pivoted to new customers like Huawei with similarly demanding camera needs. The company also appealed its blacklisting and boosted domestic Chinese clients to reduce reliance on U.S. tech giants.
For Chinese manufacturers, it remains an unpredictable environment. But Ofilm demonstrates how staying flexible and appealing to national interests could help bridge the gap until trade relations stabilize. Its journey offers lessons for supply chain resilience in the face of external shocks.