Chinese smartphone makers have been gaining influence as their
domestic market grows and they expand abroad. Huawei has pushed into
Europe and Africa, though it’s failed to crack the massive US market.
Apple tends to sell iPhones at higher prices than its rivals and profits
from services like iTunes, which helped it
top earnings estimates for the quarter.
“The importance of Huawei overtaking Apple this quarter cannot be
overstated,” said Ben Stanton, a senior analyst at Canalys, which also
reported the shift in quarterly market share.
“It is the first time in
seven years that Samsung and Apple have not held the top two positions.
Huawei’s exclusion from the US has forced it to work harder in Asia
and Europe to achieve its goals.”
Canalys pointed out that the second quarter has historically been a
weak one for Apple. The Cupertino, California-based company introduces
new phones late in the year, then usually sees sales climb in the fourth
and first quarters. That momentum for the iPhone X, which starts at
$1 000, wasn’t sustained into the second quarter, the firm said.
Globally, the smartphone market continued its slowdown with shipments
slipping 1.8% for the quarter to 342 million units. The number
of smartphones shipped in 2017 fell 0.3%, according to IDC, the
first decline after years of strong growth.
Samsung earnings
took a hit from the sluggish market when it reported earnings on Tuesday.
The South Korean company, which makes memory chips and screens as well
as smartphones themselves, reported net income that fell short of
analysts’ estimates.
“Huawei’s momentum will obviously concern Samsung, but it should also
serve as a warning to Apple, which needs to ship volume to support its
growing services division,” Stanton said in a statement. “If Apple and
Samsung want to maintain their market positions, they must make their
portfolios more competitive.”
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