Huawei bites Apple in smartphone sales rankings

Chinese brand Huawei has overtaken Apple in global smartphone sales rankings for two consecutive months – and is set to achieve a trifecta, according to research house Counterpoint.

“With August sales looking strong for the Chinese vendor, a hat-trick for Huawei could be on the cards,”says Counterpoint research director Peter Richardson..

“This is a significant milestone for Huawei, the largest Chinese smartphone brand with a growing global presence. It speaks volumes for this primarily network infrastructure vendor on how far it has grown in the consumer mobile handset space in the last three to four years,” said Richardson.

“The global scale Huawei has been able to achieve can be attributed to its consistent investment in research and development and manufacturing, coupled with aggressive marketing and sales channel expansion.”

But Richardson cautions Apple should regain its second spot given a new edition of the iPhone is set for launch in September.

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“While this streak could be temporary, it nevertheless underscores the rate at which Huawei has been growing. However, a weak presence in the South Asian, Indian and North American markets limits Huawei’s potential in the near-to mid-term to take a sustainable second place position behind Samsung. Huawei is over-dependent on its home market China where it enjoys the leadership position and operator-centric markets in Europe, Latin America and Middle East.”

Talking about future prospects and other findings, Counterpoint’s associate director, Tarun Pathak, says the growth of Chinese brands is an important trend which no player in the mobile ecosystem can ignore.

“Chinese brands with their dominant position in key markets such as China, Europe, Asia and Latin America have restricted the growth prospects for leading global brands such as Samsung and Apple. Chinese brands are growing swiftly thanks not only to smartphone design, manufacturing capability and rich feature sets, but also by outsmarting and outspending rivals in sales channels, go-to-market and marketing promotion strategies.”

Pathak says Huawei, Oppo, Vivo and Xiaomi have successfully gained access to key supply chain partners, which has allowed them to launch designs with bezel-free, full displays, Augmented Reality, in-house chipsets and advanced camera features, that have kept them toe-to-toe with rivals.

“These players have become as equally important as Samsung or Apple to the global supply chain, application developers and distribution channels, as they continue to grow in scale more rapidly than the incumbent market share leaders.”

July’s best sellers

The best-selling smartphone models in July remained Apple products, with the iPhone 7 and 7 Plus taking the two top spots. However the depth of range of Samsung and Huawei, among other brands, helped them overtake Apple in total sales.

Counterpoint senior analyst Pavel Naiya says Oppo has been one of the fastest growing brands globally thanks to the popularity of models including the flagship Oppo R11 and the mid-tier Oppo A57 that captured third and fourth spots respectively. These were followed by Samsung’s flagship Galaxy S8, Xiaomi Redmi Note 4X and Samsung Galaxy S8+. Apple’s 32GB refresh of the iPhone 6 enabled it to regain momentum during the month, with popularity across prepaid markets to edge out Samsung’s Galaxy J7.

“While Huawei climbed to be the world’s second largest brand overall, it is surprising to see none of its models breaking into the top 10 rankings,” said Naiya.

“This is due to a multiple SKU portfolio that currently lacks a true hero device. While having a diverse portfolio allows Huawei to fight on multiple fronts, it does little to build overall brand recognition; something Huawei badly needs if it is continue to gain share. While Huawei has trimmed its portfolio, it likely needs to further streamline its product range like Oppo and Xiaomi have done – putting more muscle behind fewer products.”

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