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Huawei’s chip design unit surpassed Qualcomm as the leading semiconductor provider in China. It happened after the coronavirus hit the smartphone market in the country and hit the American giant, reports CNBC.
The unit, known as HiSilicon, sold 22.21 million smartphone processors in the first quarter of 2020, almost in line with the number it sold during the same period last year, according to a new report from CINNO Research, based in China. HiSilicon managed to increase its market share to 43.9% from 24.3% in the first quarter of 2019.
CINNO Research, which monitors the chip market in the country, does not reveal sales data for Qualcomm or other suppliers, but states that the market share of the US company fell to 32.8% in the quarter through March, from 48.1% in the same quarter. last year’s period.
HiSilicon designs Kirin brand chips for use in Huawei smartphones. Semiconductors are manufactured by Taiwan Semiconductor Manufacturing Company (TSMC).
HiSilicon’s growth in China reflects the fact that Huawei has been actively targeting its home market since it was blacklisted in the United States last year. Washington’s actions restricted the Chinese company’s access to American technology, including Google services. While this is not a big problem in China, where Google services like Gmail are banned, it does have a serious impact on international users using the apps in question.
After betting on China, Huawei’s smartphone market share has grown. In the first quarter of 2020, its smartphone sales increased by 6 percent compared to last year, according to a Counterpoint Research report released today. Additionally, Huawei is trying to reduce its dependence on American components, and smartphone chips are a key part of this effort.
The company’s growth in China has also led to an increase in its share of the smartphone chip market. But Huawei’s expansion comes at the expense of the company’s internal competitors, part of which are key Qualcomm customers.
In August Qualcomm CEO Steve Molenkopf said Huawei’s focus on the Chinese market had affected the American company.
“As a result of the export ban, Huawei has redirected its efforts to build a market share in its domestic market in China, where we do not see the corresponding benefits in the form of product or license revenue,” he told investors when presenting the financial statements.
This is because Qualcomm sells chips to Huawei’s internal competitors, such as Xiaomi and Oppo. However, both recorded a drop in sales in 2019 according to market research company Canalys.
The entire smartphone market has weakened further since the coronavirus pandemic erupted, leading to the country’s blockade for several weeks in the first quarter. Mobile phone sales decreased 23% in March, after falling 56% in February, according to government figures.
Meanwhile, Apple’s iPhone sales were probably down just 1% from last year, according to Counterpoint Research.
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