On 28 January 2020, the logo of the Chinese company Huawei at their main UK offices in the west of London.
Daniel Leal-Olivus | Via AFP Getty Image
Huawei became the world’s largest smartphone player for the second time, a new report from the Canalys show.
Most of the sales came from China as its international trade suffered due to US sanctions.
According to the research firm, the Chinese vendor has reduced 55.8 million devices by 5% year-on-year. Meanwhile, in second place Samsung sent 53.7 million smartphones, 30% less than the same period last year.
This is the first time that Huawei has topped for a quarter, an ambition that has been around for many years.
But analysts doubted whether it was sustainable because the fact that Huawei’s overseas markets outside of China took a hit as a result of US sanctions against the company.
Huawei sold more than 70% of its smartphones in mainland China in the second quarter. Meanwhile, smartphone shipments to international markets fell 27% year-over-year in the April-June quarter.
According to Counterpoint Research, in Europe, a key area for Huawei, the company’s smartphone market share fell by 16% in the second quarter to 2019 over the same period. It is the third-largest smartphone maker in Europe after Samsung and Apple, showing that Huawei’s global position in the second quarter builds on China’s efforts to expand its share as the world’s second-largest economy.
Given China’s large population, success there often gives companies a large “global” market share.
“It will be difficult for Huawei to maintain its lead in the long run,” Canalys analyst Mo Jia said in a press release. “Its major channel partners in key regions of Europe, Huawei are growing by taking devices, taking fewer models, and bringing in new brands to reduce risk.”
He said that the strength in China alone would not be sufficient to sustain Huawei after the global economy improved.
Last year, Huawei was placed on the US entity list, a blacklist that limited its access to US technology. This meant Huawei could not use the licensed Google Android on its latest flagship devices.
In China, where Google services such as Gmail or its search engine are effectively blocked, this is not a big deal because Chinese consumers are not used to using those products. However, in international markets, the absence of Google is a major setback.
This is why Huawei’s rivals, who are still able to use Android on their devices, have increased market share. For example, in Europe, the Chinese firm Xiaomi saw its market share grow from 6% to 13% in the second quarter of 2019 over the same period this year, according to Counterpoint Research.
Huawei was forced to release its own operating system called HarmonyOS last year. But analysts have already doubted its success in international markets, noting that it is missing important apps from the App Store.
The Chinese telecommunications giant faced further pressure from Washington this year. A new rule introduced in May requires foreign manufacturers using US chipmaking devices to obtain licenses before selling semiconductors to Huawei.
This may affect Huawei’s ability to purchase chips for its smartphones. While Huawei designs its own processors, they are manufactured by TSMC of Taiwan which may be affected by this rule.