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Samsung remains the leader in smartphone shipments globally, but Chinese player Huawei is now the world second largest smartphone vendor’, ahead of Apple. This is the first time that Huawei has pipped Apple for the number two position. According to numbers shared by research firms International Data Corporation (IDC), Counterpoint Research and Canalys, Huawei is now firmly in the second position.
While global smartphone shipments declined 2 per cent annually in the second quarter of 2018, according to Counterpoint, the top 10 players have managed to capture 79 per cent of the market. According to IDC, smartphone vendors shipped a total of 342.0 million units during the second quarter, which was a 1.8 per cent decline on an yearly basis.
Let’s take a look at how Huawei rose to number two in the segment and how other players fared this quarter based on numbers shared by these three research firms.
This is certainly the highlight of the quarter. Huawei is number two for the first time beating Apple, and also dominates the all-important China market.
“Huawei achieved this by launching smartphones in the premium segment and capturing the mid-tier segment with its fast-growing Honor sub-brand. Huawei with its Honor brand is offering a broad and recently refreshed portfolio at affordable prices that is driving growth in the overseas market,” noted Tarun Pathak, Associate Director at Counterpoint Research. The firm also expects Huawei and Honor’s store counts to increase in the future, further boosting shipments.
Also read: Huawei is now world’s second largest smartphone vendor ahead of Apple
According to Counterpoint’s data, Huawei shipments grew 41 per cent annually in the second quarter of 2018. It grew fully 71 per cent overseas. Research firm Canalys’ data showed that Huawei shipped 54 million handsets in the quarter.
Huawei has achieved this success thanks to the strong sales of its latest flagship, P20 and P20 Pro, which exceeded the performance of its previous P10 and P9 phone. Huawei shipped 7 million units of the P20 and P20 Pro in the quarter, notes Canalys.
In fact, outside of China, the P20 and P20 Pro more than doubled the shipments of the P10 and P10 Plus, notes the research firm. Huawei’s P20 Pro is the first smartphone in the world to ship with triple cameras.
Read more: Apple reports best June quarter ever driven by services, wearables growth
“Huawei’s strategy has evolved significantly over the last six months,” said Mo Jia, Canalys Analyst in a press statement. “Despite its failure to strike a US carrier partnership earlier this year, the company has turned around quickly, moving away from its drive for profitability and focusing instead on finding volume growth at the low end. Honor, which has long been a major brand in China but relatively small overseas, has taken a pivotal role in this strategy,” she added.
Coming to Honor, the brand’s share of overall Huawei smartphone shipments increased to 36 per cent this quarter. Over 4 million Honor-branded smartphones were shipped outside China. In India too we have seen the Honor brand aggressively competing with Xiaomi and Samsung, with newer offerings across price points.
Read more: Xiaomi Mi A2 first impressions: The key features that stand out
Finally, according to IDC, Huawei now has 27 per cent record high share in China smartphone market, and the premium P20/P20 Pro series had strong demand in the $600-$800 price segment. This has also boosted Huawei’s profile in the high-end segment, according to IDC.
While Samsung remained on top in terms of the overall shipments, Counterpoint notes that it had an annual decline of 11% due to weak sales of its flagship Galaxy S9 series. According to IDC, Galaxy S9/S9+, “witnessed slower than normal sales according to Samsung.”
IDC notes there is more competition in the high-end market, and all eyes will now be on the upcoming Galaxy Note 9, which launches on August 9. Whether it can boost the company’s performance in the future quarter will be crucial.
Read more: Huawei P20 Pro camera review: Is it as good as a DSLR?
Coming to Apple, which has now slipped to number three, Counterpoint notes that iPhone X remains the top seller during the quarter. Apple’s yearly growth in iPhones was only 1 per cent, while second quarter shipments remained flat in China for the company on an yearly basis. Apple shipped 41.3 million iPhones during quarter.
According to Canalys Senior Analyst Ben Stanton, “Q2 has always been seasonally weak for Apple…While the iPhone X succeeded in generating volume in the previous quarters despite its hefty price tag, it has been unable to sustain that volume this quarter. But for an Apple flagship, this is normal. In addition to this, models such as the iPhone 7 and 7 Plus are also losing steam, given a high sell-in in Q1.”
Canalys estimates that Apple shipped over 8 million iPhone X units in this quarter, compared to 14 in Q1. IDC however, notes that Apple will look to regain control of the market this fall with the expected launch of three new iPhone devices, which will be spread across price points. Apple’s 6.1-inch LCD iPhone is expected to be a budget device starting at $600.
Xiaomi has recently gone public with an IPO listing on Hong Kong markets and the company shipped 33 million smartphones globally. Xiaomi has managed to capture 9 per cent of the market, according to Counterpoint, putting it just below Apple. It saw record shipments in India with 112% annual growth.
According to IDC, Xiaomi has also closed the gap with Samsung in Indonesia as it ramped up its local production to address the increased demand.
According to Counterpoint, the decline of the Chinese smartphone market has negatively impacted brands like OPPO, vivo, Meizu and Gionee, which explains why they are now investing outside this market.
It also looks like Nokia HMD, OnePlus, Tecno, Infinix were the key fast-growing brands for the quarter. However, Lenovo, Gionee, Micromax and Sony registered the highest shipment volume declines in quarter. For the first time, new-comer Tecno is also part of the top 10 smartphone vendors; the brand is part of China’s Transsion holdings, which also owns iTel and Infinix.
Read more: Apple Q3 results in numbers: iPhone prices continue to rise, services grow 31 per cent
While OPPO and vivo were the fifth and sixth largest brands during the quarter, Counterpoint data showed that Oppo had an annual decline of 3%, while vivo registered a growth of only 1%. Research firm IDC noted that OPPO faced a slowdown in key markets like India and most of Southeast Asia. However, IDC numbers showed 5.1% per cent growth for OPPO.
Meanwhile, LG registered 10.2 million smartphone shipments with 23 per cent annual decline, according to Counterpoint data. The research firm ranked Lenovo (includes Motorola) at number eight with 3 per cent market share.
Nokia and its parent HMD Global also broke into the top ten for the first time, according to Counterpoint with 4.5 million shipments and over 782 per cent growth. Tecno was number ten in the list with 4.4 million shipments and 44 per cent growth.
