The new report showed that Huawei is doing well again. How does she do it?

The next news can only be published under the heading “not again, but again”. Once again, it is difficult to ignore the news that Huawei manages to maintain its leading position and outstrip many other manufacturers. Once again, according to the results of the quarter, the company became the leader in sales, ahead of even Samsung. All this despite the fact that the company is not even thought to be taken out of the sanctions. As usual, there is a simple explanation for this, only it once again contradicts analysts' forecasts. As the saying goes, “it sinks, sinks, but does not sink in any way.” What's going on with this company?

The new report showed that Huawei is doing well again.  How does she do it?

Huawei 'who could'

How are you Huawei

According to a Canalys report, Huawei surpassed Samsung as the world's largest smartphone manufacturer in the second quarter of 2020.

This happened against the background of how some time ago Counterpoint Research analysts were skeptical about the leadership Huawei in global smartphone sales. So they commented that in April this year Huawei outstripped Samsung in sales. Of course, this was associated with temporary changes against the background of the uneven spread of the coronavirus, but the assumption turned out to be incorrect.

Interestingly, the Canalys report says this is the first time in the last 10 years that a company other than Apple and Samsung has topped the ranking of global smartphone sales. And you say sanctions …

Now all companies have suffered from the global drop in sales and they have to do something. Huawei is also fighting this fight, but besides that, she is still forced to somehow explain to people that there is life without Google services and continue to develop her AppGallery application store.

Why Huawei sells a lot of smartphones

Of course, Huawei helps the growth of demand in the domestic Chinese market, where compatibility with Google is not important to anyone, but the company manages to top the rankings in other countries as well.

For example, according to many analytical agencies, smartphones Huawei and Honor lead the popularity rating in Russia and are among the top three in many European countries. Most likely, this is due to the fact that they are inexpensive (the company makes a lot of promotions to stimulate demand in difficult times), and most users are satisfied with what AppGallery has – instant messengers, social networks, Yandex applications (in Russia).

The new report showed that Huawei is doing well again.  How does she do it?

An important success factor Huawei.

However, it was still China that became one of the first countries to largely recover from the effects of the pandemic, and the activities Huawei in this country had a large positive impact on the company's success. To understand the picture, suffice it to say that in the second quarter, China accounted for 72% of the company's total shipments. In the first quarter this indicator was 61%, and last year it was just over 50%. The Chinese helped soften the fall, but the company was able to somehow minimize losses in the global market.

How much fewer phones were sold Huawei

In the second quarter, the decline in shipments of smartphones Huawei was 27%. This is significant, but everyone lost, and many even more. For example, Samsung cut shipments by 30% for the quarter. These are global losses, and the fact that China is “dragging” Huawei, says the market share of Samsung in this country – only 1%.

The new report showed that Huawei is doing well again.  How does she do it?

The logo Huawei has become a symbol of resistance for many. So far, the company manages to justify this.

If we set aside very relative percentages and speak in specific values, then Huawei shipped 55.8 million devices in the second quarter of this year. During the same period, Samsung was able to sell only 53.7 million handsets according to its data. Some analysts predicted approximately the same figures for this quarter. At least towards the end of the quarter, few people were surprised by the leadership of the telecommunications giant.

This is a remarkable result that few would have predicted a year ago, ”said Ben Stanton, senior analyst at Canalys. – If it were not for COVID-19, this would not have happened.

What will happen to Huawei due to sanctions

Despite the fact that Huawei gathered her will into a fist and was able to realize all her strengths, it cannot yet be said that success will be long. We do not know if the company will be able to continue like this and how long it will last. As more countries recover from the effects of the pandemic, the company's US trade ban is likely to continue to impact its global performance. But so far the global problem has played into the hands of the company and, along with competent management, has made it easier for it to survive the transition period.

The new report showed that Huawei is doing well again.  How does she do it?

In this building, the right decisions are made to help Huawei survive.

This is quite obvious if we judge by the data for 2019. Shortly before the ban Huawei increased its global shipments by 61% in Q1 2019. The company reportedly expected its troubles to cut sales by 20% in 2020 in March. It is not yet clear what will happen in the end, so we will return to this conversation closer to the end of the year.

I also note that Samsung can expect a short-term increase in device shipments in the second half of the year after the August 5 event and the announcement of the Galaxy Note 20 series. It is likely that Huawei will also unveil its Mate 40 series this year, but when they start devices sold is not clear. So we just wait and see what happens next.

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