Huawei’s efforts in ramping up smartphone shipments with new devices seem to be paying off in its domestic market. According to the latest report by market analyst firm canalys, the Chinese smartphone and telecommunications giant has broken the record of “biggest ever share” when it comes to the smartphone market in China. The report added that Huawei accounted for about 27 percent of the total smartphones in China in Q2 of this year breaking a record. It also pointed out that the total number of smartphone shipments crossed 100 million again in Q2 after a dip in the previous quarter.
The report noted that this bounce back in terms of the total device shipments comes as a much-needed relief for local smartphone makers, vendors, and partners as the “shipments fell by more than 20 percent” to the 91 million number. Coming back to Huawei, the company shipped 28.5 million smartphones and it was followed by Oppo and Vivo in the second and third spot with 21 and 20 percent market share respectively. Xiaomi held the fourth spot on the list with 14 percent market share and Apple held the fifth spot in the market.
Watch: Honor 9N First Look
According to the report, it is getting difficult for other smaller smartphone vendors to compete with the giants in the market as the top four smartphone players held about 90 percent of the total smartphone shipments as compared to 73 percent of shipments one year ago. One thing to note here is that Vivo was the fastest growing company in the market with about 30 percent growth to close the gap with Oppo. Huawei was the second fastest growing company with 22 percent growth when compared to Q2 in 2017.
For perspective, Huawei grew from 21 percent last year to 27 percent this year, Oppo grew about three percent from 19 percent a year ago to 21 percent this year, and Vivo grew from 14 percent last year to 20 percent with 30 percent of the growth. Talking about Xiaomi, the company maintained did not grow much but the percentage changed from 13 percent last year to 14 percent this year.
The report pointed out that the reason for the growth of Huawei was the growth of its sub-brand Honor to 55 percent from 33 percent last year. Mo Jia, an analyst with Canalys added, “Honor is now the largest smartphone brand in the Huawei Consumer Business Group”. He went on to add, “Enjoying a high level of autonomy within Huawei, Honor has been pushing to make a name for itself in the market. It has expanded successfully into the US$500+ segment with its latest flagship models and continues to erode the market share of its direct competitors in the low-cost segment, such as Xiaomi.”
Jia also pointed out that growth of Honor is likely to “pose a dilemma” for the company on which sub-brand to focus on to reach the 200 million shipment target by the end of 2018. Talking about the market, Jia stated, “ The market is expected to decline in the following quarters as well, mainly owing to harsh declines in shipments from smaller vendors that are unable to sustain volumes and are therefore finding it difficult to justify further investment in the market.” Uncertain trade situations with the United States are also likely to impact the larger vendors.