The Chinese technology company shipped 55.8 million phones in the quarter ended June, beating Samsung’s long-time rivals, which shipped 53.7 million, according to the Canalys report.
“Taking first place is very important for Huawei,” said Canalys analyst Mo Jia. “It is desperate to show the strength of its brand to domestic consumers, component suppliers and developers.”
Huawei has still suffered an annual decline in smartphone shipments 5%. But Samsung was much larger by 30%, according to Canalys.
The market research firm said Huawei’s victory over Samsung would not have happened without Covid-19. The company has been able to take advantage of the economic recovery in China, where Huawei now sells more than 70% of its smartphones. Samsung has a very small presence in China.
Huawei’s global smartphone and telecom gear business continues to suffer the slump from U.S. sanctions that shut down the company from key U.S. technology and supplies.
“It will be difficult for Huawei to maintain its long-term advantage. Its key channel partners in key regions, such as Europe, are increasingly wary of Huawei’s range of devices, to take fewer models, and to bring in new brands to reduce risk.Power in China alone is not enough to sustain Huawei at the top once the global economy begins to recover, “he said.
“Our business has shown exceptional resilience in these difficult times,” Huawei spokeswoman Evita Cao said. Cao did not answer questions about how the company could maintain its advantage going forward.
Samsung reported an operating profit of 8.15 trillion won ($ 6.8 billion) for the quarter ended June, up more than 23% compared to the same period last year.
Samsung said sales fell about 6% to 53 trillion won ($ 44.6 billion).
Despite the double-digit decline in annual smartphone shipments for the quarter-year observed by the Canalys report, Samsung reported that the unit remained profitable thanks to savings in trading costs. (Samsung did not break the specifics about its smartphone shipments, but noted that they have declined.)
However for the second half of 2020, Samsung is warning that “uncertainties related to Covid-19 will last” for its mobile phone business.
That may be enough to drag the company to a loss of revenue for the year, according to research firm Crisp Idea.
The consumer electronics unit, which includes smartphones and televisions, “is expected to decline significantly as Covid-19 affects demand and leads to the closure of stores and plants globally,” Crisp Idea analysts wrote in note earlier this month.
Smartphone shipments worldwide are expected to fall about 18% in the first half of the year as the pandemic continues to affect consumer spending, analysts at IDC said last month.
The market research firm added that global smartphone shipments are not expected to return to growth by the first quarter of 2021.