The Chinese tech company shipped 55.8 million phones in the three months ending June, beating rival Samsung, which shipped 53.7 million, according to the Canalys report.
“Taking first place is very important to Huawei,” said Canalys analyst Mo Jia. “He is desperate to show his brand strength to domestic consumers, component suppliers, and developers.”
Huawei still suffered an annual decline in smartphone shipments from 5% But Samsung was much bigger at 30%, according to Canalys.
The market research firm said that Huawei’s victory over Samsung would not have happened without Covid-19. The company was able to take advantage of the economic recovery in China, where Huawei now sells more than 70% of its smartphones. Samsung has a very small presence in China.
Huawei’s global smartphone and telecommunications business continues to suffer the consequences of U.S. sanctions that cut off the key U.S. technology and supplies company.
“It will be difficult for Huawei to maintain its leadership in the long term. Its main channel partners in key regions, such as Europe, are increasingly cautious regarding the range of Huawei devices, the acquisition of fewer models and the incorporation of new brands for reduce risk. ” Strength in China alone will not be enough to keep Huawei on top once the world economy begins to recover, “he said.
“Our business has shown exceptional resilience in these difficult times,” said Huawei spokeswoman Evita Cao. Cao did not respond to questions about how the company can maintain its leadership in the future.
Samsung reported an operating profit of 8.15 trillion won ($ 6.8 billion) during the three months ending in June, more than 23% compared to the same period last year.
Samsung said sales fell approximately 6% to 53 trillion won ($ 44.6 billion).
Despite the double-digit decline in annual smartphone shipments during the quarter noted by the Canalys report, Samsung reported that the unit remained profitable thanks to savings in marketing costs. (Samsung does not reveal specific details about shipments of its smartphones, but noted that they declined.)
However, for the second half of 2020, Samsung warns that “uncertainties related to Covid-19 persist” for its mobile business.
According to research firm Crisp Idea, that could be enough to drag the company into lost revenue during the year.
The consumer electronics unit, which includes smartphones and televisions, is expected to “decrease significantly as Covid-19 affects demand and leads to the closure of stores and plants worldwide,” Crisp Idea analysts wrote in a note earlier this month.
Smartphone shipments worldwide are expected to drop approximately 18% in the first half of the year, as the pandemic continues to affect consumer spending, IDC analysts said in a note last month.
The market research firm added that global smartphone shipments are not expected to grow again until the first quarter of 2021.
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