According to market analysts Huawei’s success can be attributed to the slowdown in China, the world’s largest market for smartphones, and to the company’s success in growing market share in Europe. Huawei failed in its recent bid to launch in the US after it was deemed a security threat.
The rise of Huawei is being seen as significant, it’s the first time in seven years that Samsung and Apple haven’t occupied the top two places in terms of marketshare.
Approximately 351million smartphones were sold globally in the second quarter, which is a 2% decline year-on-year. This decline is being attributed to market saturation, higher prices, people taking longer to replace phones, and a lack of feature and design innovation.
Samsung was worst hit by the slowdown, reporting a drop of 10% year-on-year, selling 71.9m smartphones. Despite that fall it still accounts for 20% of the market. Huawei took second spot selling 54.2m phones, a rise of 41%, for a 15% share. Apple sold 41.3m iPhones, up 1%, for a 12% market share.
Analysts warned both Apple and Samsung that if they wanted to maintain their market positions, they would have to make their portfolios more competitive.
Counterpoint Research said that Huawei’s strategy, using its fast-growing Honor sub-brand to capture the mid-tier segment below £500 and its premium Huawei-branded smartphones at the top end, such as the P20 Pro, appeared to be working.
Perversely, Huawei’s exclusion from the US has benefitted the company. It has had to work harder across both Asia and Europe to achieve its growth goals, with its mid-range models proving particularly popular.
Huawei is also benefitting from increasing brand recognition that’s allowing it to compete at the top end.
However, the Chinese market remains key for the company especially as it has come under the security spotlight in many western markets including the US, Australia and the UK.
