Huawei Facing Extra Pressure On Smartphone Sales

Huawei is facing added pressure on its smartphone sales in 2020 as rising handset inventory levels in China’s channels are being compounded by the coronavirus outbreak, according to sources at Taiwan’s handset supply chain.

Sales of Huawei’s smartphones in China are expected to experience steep drops as the outbreak has faltered business activities and crippled sales channels in the country, said the sources.

Global sales of Huawei’s smartphone have slowed down since the second half of 2019 after losing Google’s GMS (Google Mobile Services) support as a result of a US trade ban, the sources noted.

Data from Strategy Analytics showed that Huawei shipped 56 million smartphones worldwide in the fourth quarter of 2019, sliding 7% from a year earlier. Its global market share also dropped to 15% from 16% during the same period.

However, prior to the outbreak, Huawei had fared much better in the domestic market. It shipped about 75 million smartphones in China in the second half of 2019, growing nearly 50% from a year earlier and taking a 40% of market share.

Now channel sales of smartphones in China have chilled due to widespread transport curbs and tough public health measures, said the sources, expecting Huawei’s smartphone shipments in China to sap by 5-8 million units in the first quarter of 2020 sequentially and the excess inventories in the channels will not be digested till the second quarter.

Sales performance of other brands including Oppo, Xiaomia and Vivo could also be affected in the first quarter, the sources commented.

Apple shipped about 72 million iPhone devices in the fourth quarter of 2019, driven by strong sales of the iPhone 11 models. The US vendor is expected to maintain shipments of 55-60 million units in the first quarter of 2020, the sources estimated.

Samsung is likely to fare the best in the first quarter, leveraging its production base in Vietnam, strong sales of its A-series lineup and the release of new flagship and foldable models, said the sources.―Digitimes