Huawei's growth in China has given it a big edge over Samsung and Apple in Q2, according to the report.
- Chinese tech giant Huawei shipped more phones than any other company in Q2 2020, according to research firm Canalys.
- That makes it the first time in nine years that a company other than Samsung or Apple led the quarter, the report says.
- Huawei's dominance was largely fueled by its growth in China, which has seen better recovery from the COVID-19 pandemic than other markets like the US'.
- But Canalys warns that Huawei's spot at the top might be short lived, as growth in China likely won't be enough to remain the market leader once the global economy recovers.
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Chinese tech giant Huawei shipped more smartphones than any other company in the second quarter of 2020, making it the first quarter in which a company other than Samsung or Apple led the market in nine years, according to a new report from research firm Canalys.
Huawei shipped 55.8 million devices in the quarter, which is down 5% year-over-year but still enough to beat Samsung, which shipped 53.7 million smartphones in Q2. For Samsung, that's a decrease of 30% compared to Q2 2019, the report says.
A key driver behind Huawei's success has been its growth in China, which has seen its economy start to recover from the coronavirus pandemic as COVID-19 case numbers have spiked in other markets like the United States and Europe. Huawei has largely relied on sales in China after US trade restrictions have barred the phone maker from loadings its phones with Google's popular apps.
The restrictions have damaged Huawei's international sales, as domestic shipments were down 27% in the second quarter. But the company is a dominant player in China, as it now sells more than 70% of its phones in mainland China, reports Canalys.
The COVID-19 pandemic has decimated the global smartphone market overall, with the International Data Corporation forecasting that the market could decline by 11.9% year-over-year in 2020. But Huawei's reliance on the China market has given it a boost, reports Canalys.
"This is a remarkable result that few people would have predicted a year ago," Ben Stanton, a senior analyst at Canalys, wrote in a statement announcing the report's findings. "If it wasn't for COVID-19, it wouldn't have happened. Huawei has taken full advantage of the Chinese economic recovery to reignite its smartphone business."
Samsung, however, has a small presence in China according to Canalys, which reports that the South Korean electronics giant accounts for less than 1% of the market share. The report did not mention Apple, but China is the iPhone maker's third-largest market according to its most recent earnings report, coming after the United States and Europe.
But Huawei's spot at the top could be limited; the report notes that dominance in the Chinese market won't be enough to sustain Huawei over the long term as the global economy recovers from COVID-19.
The report also comes just as Samsung and Apple have been leaning into selling cheaper devices to combat a global slowdown across the industry as consumers have held onto their devices for longer periods of time. Both companies are also expected to launch new high-end devices in the coming weeks and months, and rumors suggest Samsung could debut a new version of its Galaxy Note next month.
Apple, meanwhile, is expected to debut its first 5G iPhone in the fall. And if Apple's 5G-enabled iPhone sells as well as the iPhone 11 lineup, Apple could become the market leader for 5G phones, according to Strategy Analytics.