Huawei's China smartphone shipments soar at the expense of rivals like Apple

Key Points
  • Huawei's smartphone shipments surged 66% year-on-year in the third quarter, according to research published Wednesday by Canalys.
  • Huawei captured a record 42% of China's overall smartphone market.
  • Chinese consumers are flocking to Huawei's devices as the Chinese tech giant faces ongoing headwinds from the U.S. and other regions.
Richard Yu (Yu Chengdong), head of Huawei's consumer business Group, speaks on stage during a presentation to reveal Huawei's latest smartphones "Mate 30" and "Mate 30 Pro" in Munich,on September 19, 2019.

Huawei captured a record share of China's smartphone market in the third quarter as its device shipments soared at the expense of rivals, according to new data from research firm Canalys.

Canalys said Huawei shipped 41.5 million smartphones in China in the third quarter, representing 66% growth year-on-year. The Chinese tech giant now commands 42% of China's overall smartphone market, far outpacing Apple and local Chinese competitors like Vivo, Oppo and Xiaomi.

"Huawei opened a huge gap between itself and other vendors," said Nicole Peng, Canalys VP of mobility. "Its dominant position gives Huawei a lot of power to negotiate with the supply chain and to increase its wallet share within channel partners."

Why the US thinks Huawei is a massive national security threat

Chinese consumers are flocking to Huawei's devices as the Chinese tech giant faces ongoing headwinds from the U.S. and other regions. Huawei has been unable to license the latest version of Android on its new Mate 30 smartphone due to restrictions imposed by the U.S. on the Chinese firm.

U.S. officials argue Huawei's technology could pose a national security risk by opening a backdoor for Chinese spying. They point to Chinese laws that allegedly require every domestic company to assist with intelligence gathering if Beijing requests it. Huawei has repeatedly denied that it would engage in any form of espionage or provide data to the Chinese government.

Canalys said Wednesday China's smartphone market remained "gloomy," with overall shipments shrinking 3% against the previous year. Apple, the world's third-biggest seller of smartphones, warned about weak demand in China earlier this year but has since cited improvements in the market.

Apple maintained its position as the fifth-biggest seller of smartphones in China, according to Canalys. The research found the iPhone 11, which went on sale in September, accounted for nearly 40% of Apple's third-quarter shipments in the region. Analysts will be closely watching Apple's outlook for the Chinese market when the company reports earnings after the market close on Wednesday.