The unstoppable rise of Chinese smartphone manufacturer Huawei continues, with a reported massive 40% hike in quarterly sales. The figures move Huawei (15.8% market share) above Apple (12.1% share) and into second place in the global phone market for the first time. The market leader, Samsung saw profits drop 10%, largely due to a disappointing uptake of the Galaxy S9.
Security concerns
Selling 54 million phones is impressive when you consider that Huawei has had difficulty making inroads in the United States. The telecoms equipment maker has been fighting US Government concerns that their products could be used by for Chinese state intelligence purposes. Huawei have dismissed such worries; however, they are still unable to secure a major partnership with a US carrier. This is a vital step in growing the business and one to watch. Not least as the UK, Australia and Canada have also voiced similar security concerns.
The key to the spectacular climb has been Huawei’s move away from a profitability drive. Instead, it has focused on increasing its growth at the low-end of the smartphone market. The Honor sub-brand has come up trumps here but the premium end of the market has brought rewards too. Huawei CEO, Richard Yu expects the P20 stable (P20 Pro, P20 and P20 Lite) to exceed 20 million shipments in 2018.
Narrowing the gap
With the ever-increasing cost of iPhones and decreasing Apple sales, the gap looks likely to increase in the short-term. Increasing brand awareness in Europe and Asia could also see Huawei muscle in on Samsung sales. Added features, such as triple rear cameras in its flagship P20 Pro smartphone, challenge the dominance of the South Korean electronics giant and the unremarkable Galaxy S9. With the release of the iPhone 11 due in September, the gloves are well and truly off in the battle for smartphone supremacy.
