Huawei is geared for transforming the Mobility Industry

Huawei shipped 55.8 million devices, down 5% year on year. But second-placed Samsung shipped 53.7 million smartphones, a 30% fall against Q2 201. Huawei is still subject to US government restrictions, which have stifled its business outside of mainland China. Its overseas shipments fell 27% in Q2. But it has grown to dominate its domestic market, boosting its Chinese shipments by 8% in Q2, and it now sells over 70% of its smartphones in mainland China. China has emerged strongest from the coronavirus pandemic, with factories reopened, economic development continuing and tight controls on new outbreaks.

“Globally, a lack of consumer and business confidence has softened demand for premium smartphones. But China bucks the trend, with strong growth in demand for expensive handsets, and even surpassed the US in Q2 2020 to be the world’s largest market for smartphones over US$600.” When we look at the datapoint related to Huawei which might be helpful today.

Huawei worldwide smartphone shipments units, and market share:  

Q2 2019: 58.7 million units, 17.7%

Q2 2020: 55.8 million units, 19.6%

“Huawei, despite being subject to US sanctions, gained global market share in the first half of the year. Its renewed focus on China proved shrewd, as China recovered strongly from COVID-19. In Q2, it surpassed Samsung to be the world’s largest vendor for the first time” 

Huawei smartphone shipments, by country:

Q2 2019: China: 37.3 million, ROW: 21.4 million

Q2 2020: China: 40.2 million (+8%), ROW: 15.6 million (-27%)

“Huawei has struggled to generate confidence in channel partners in critical overseas markets, such as Europe. Its rivals have weaponized this to strike new deals with carriers and distributors.”

The role of the Chinese market is overwhelming in boosting Huawei’s sales number as over 70 per cent of the 55.8 million devices sold by the company were sold in mainland China. Huawei’s international shipment suffered under US sanctions and the rising anti-China sentiments across the world as the global exports plummeted by 27 per cent in the April to June quarter.

China smartphone shipments above US$600: 

Q2 2019: 11.0 million units 

Q2 2020: 14.5 million units (+32.3%)

“Taking first place is very important for Huawei,” said Canalys Analyst Mo Jia. “It is desperate to showcase its brand strength to domestic consumers, component suppliers and developers. It needs to convince them to invest, and will broadcast the message of its success far and wide in the coming months. But it will be hard for Huawei to maintain its lead in the long term. Its major channel partners in key regions, such as Europe, are increasingly wary of ranging Huawei devices, taking on fewer models, and bringing in new brands to reduce risk. Strength in China alone will not be enough to sustain Huawei at the top once the global economy starts to recover.”

When we look at the each vendor wise market share, smartphones above US$600, Q2 2020: 

Worldwide: 

Apple: 57.3%

Huawei: 16.5%

Samsung: 16.4%

China (mainland):  

Huawei: 51.1%

Apple: 37.6%

Vivo: 3.8%

“In China, Huawei has phenomenal brand awareness in the premium space with its P- and Mate-series devices. Demand for the Mate40 series is expected to be strong in China, but despite this, amid US sanctions, component constraints may limit the total quantity of new Kirin-powered smartphones Huawei can produce.”