Huawei has returned to the top of China’s smartphone market after staging an aggressive comeback in the face of an ongoing US crackdown, with Apple falling to fifth by shipments in Asia’s largest economy.
Figures for the first quarter of 2024 released on April 26 by analytics company Canalys show that Huawei shipped 11.7 million smartphones in China. This is up 70% from a year earlier, when the company, hit by US sanctions, was still trying to rejuvenate its handset business.
Apple sank four places to rank fifth, with its Chinese shipments tumbling 25% to around 10 million. Oppo’s and Vivo’s shipments in the home market were down 14% and 9%. Honor, which was once Huawei’s budget smartphone brand but was spun off in 2020, logged 9% growth in the domestic market.
China is the world’s biggest smartphone market but a highly competitive one, with razor-thin gaps between the top six vendors. Only a few hundred thousand units separated the top players in the first quarter, and much variation can be expected from quarter to quarter, Canalys analyst Runar Bjorhovde told Nikkei Asia.
Huawei stunned market watchers and policymakers alike last August when it released the Mate 60 Pro, its first 5G-capable smartphone using its own chips since the US placed the company on a trade blacklist over alleged ties to the Chinese military. Huawei has repeatedly denied such allegations.
Huawei followed up that surprise release—it began selling the phones without an official launch event—with its latest flagship smartphones, the Pura line. The revamped and renamed lineup went on sale this month, exactly 12 years after Huawei introduced its P series of flagship phones.
The Chinese tech champion’s return to the top in the home market suggests a strong comeback in the smartphone industry after its handset business got severely dented by Washington’s tailored export controls that cut off its access to American technology in 2019. Huawei also had to develop its own operating system, HarmonyOS, as it could not use Google’s Android and Google Mobile Services. Huawei now talks of making HarmonyOS a third mobile operating system for the world, alongside Android and Apple’s iOS.
The latest figures will likely be disappointing to Apple CEO Tim Cook, who was recently in China for the opening of a flagship store in Shanghai. On his visit, which included an announcement on expansion of Apple’s R&D center there, he emphasized the country’s importance to his company. Apple generated about 17% of its October-December net sales in the greater China region, and the country is the biggest source of suppliers in its overall supply chain.
“Huawei’s current performance will be key for the success for HarmonyOS,” Bjorhovde said. “A few consistent years of consistent, strong sales volumes can build up a sufficient installed base to become an attractive platform for developers.” Huawei boasts that HarmonyOS is now installed on more than 800 million devices — a tally that includes phones, wearables, computers, cars and other connected gadgets.
“Overseas, it is still looking bleak for Huawei,” Bjorhovde said.
“The first step needed before it will consider any global expansion is to get HarmonyOS up to a competitive level globally, and this depends upon consistent domestic performances over time. … We can expect Huawei to push on into a couple of markets in 2024 to test the potential of expanding its smartphone business over the years to come,” he said.