Huawei Shipped 240 Million Smartphones in 2019

Posted on December 31, 2019 by Paul Thurrott in Android, Cloud, Mobile with 38 Comments

Huawei’s two biggest businesses grew at a healthy clip in 2019 despite a U.S. blacklisting, but the firm warned of a “difficult” 2020, noting that it would not “grow as rapidly as [it] did in the first half of 2019.”

“In the long term, the U.S. government will continue to suppress the development of leading technology, a challenging environment for Huawei to survive and thrive,” Huawei chairman Eric Xu wrote in a New Year’s letter to the company’s employees and customers. “The external environment is becoming more complicated than ever, and downward pressure on the global economy has intensified.”

Huawei is the world’s biggest maker of networking equipment and the world’s second-biggest maker of smartphones. Most analysts believe that Huawei would have surpassed Samsung in 2019 to become the biggest smartphone maker as well, but the U.S. blacklisting has at least temporarily denied it that accolade.

Xu said that Huawei posted revenues of $122 billion in 2019, a new record, and an 18 percent gain year-over-year (YOY). The firm has no obligation to provide such numbers, but it does typically announce its quarterly results in a bid for transparency. The problem, apparently, is that Huawei’s growth slowed dramatically in the second half of the year. Reuters calculates that Huawei’s revenues improved by just 3.9 percent (year-over-year) in the 4th quarter, to about $23.38 billion.

Xu also said that the firm sold 240 million smartphones in 2019, a gain of 20 percent YOY, and higher than analyst estimates. It had sold 206 million units in 2018.

Xu said that Huawei would “go all out” in 2020 to expand its smartphone business by building out its Huawei Mobile Services, a set of services and applications that will replace as many of Google’s popular Android applications as possible. This, of course, is the problem with the U.S. blacklisting of Huawei: It will drive the firm to lessen its reliance on U.S.-based networking, hardware, and software solutions and companies, a move that will ultimately harm the U.S., thanks to Huawei’s massive reach.

And Huawei has seen great success despite a U.S.-led initiative to keep the firm out of emerging 5G networks around the world: Huawei won over 60 5G-related contracts in 2019, over half of them in Europe. But Huawei’s biggest rival, Ericsson, reported that it signed 78 5G-related contracts and agreements with global carriers in 2019.

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Comments (41)

41 responses to “Huawei Shipped 240 Million Smartphones in 2019”

  1. Avatar

    Bats

    For one thing..."shipped 240 million phones?" So what and.........where?


    Every Microsoft fan should be well aware by now the difference between shipped and sales. That's because Microsoft often uses the shipped figure because it's always the higher amount, which always gives the illusion of success. Every Microsoft fan should know this.


    Second, who cares about Huawei's success? More power to them. Markets adapt. Does Thurrott actually think that the US will suffer at all? Once everything is cleared with the US/China relations.....Huawei will race to the US door in a heartbeat.



    • Avatar

      Paul Thurrott

      In reply to Bats:

      Do I actually think that the US will suffer if Huawei doesn't use or need US-based software, services, or hardware?


      Yes. Obviously.


      The last thing you want is to cure one of the biggest and most powerful tech companies of its need to partner with corporations here.

      • Avatar

        lvthunder

        In reply to paul-thurrott:

        That all depends on the outcome. We may suffer in the short term, but if we get a good deal we may end up benefiting in the long run.

        • Avatar

          wright_is

          In reply to lvthunder:

          The problem is, the USA has shaken confidence in US products, especially tech. A lot of their income is international and the USA is doing its best to sully its name with its international trading partners.

          The clear message that the USA is sending to Europeans and other nations is: don't buy into US technology, you cannot guarantee that you will have access to it, when you wake up tomorrow morning. Buy local.

          • Avatar

            yangstax

            The big lesson Huawei and all other Chinese manufacturers have learned from the Huawei sanctions is to de-Americanize supply chains as fast as they can. Huawei doesn't use American parts for their 5G base stations anymore. Huawei Mate 30/Pro has zero American parts inside and still has sold over 12 million units. American businesses and industries are getting hurts short term and even worse in the long term. They will lose Chinese market eventually.


    • Avatar

      Paul Thurrott

      In reply to Bats:

      Sold means sold. You don't have to be a Microsoft fan to understand words. Not all companies use Microsoft's metric for "sold into the channel." In fact, many big tech firms---Sony and Apple, for example---do not.

  2. Avatar

    Stooks

    Yawn. What was the average selling price?


    I remember when Samsung and Apple were battling it out in court and all those documents were released. The world found out that Samsung (the number one seller of smartphones at the time) had an average selling price of $65. So basically selling those Galaxy S7,8,9,10 etc by the carton and selling the $65 throw away Android junk phones by the millions.


    I suspect that the Chinese governm....or....ummm.....Huawei does much of the same.

    • Avatar

      Paul Thurrott

      Seems like high volume/low price is a great business model.
      • Avatar

        VancouverNinja

        In reply to paul-thurrott:

        ”Sell to the classes, drink with the masses. Sell to the masses drink with the classes”

      • Avatar

        xamzara

        In reply to paul-thurrott:


        What kind of net margins Huawei has in their mobile business?


        They are profitable, but by how much?


        What about the ASP in their mobile business?


        I would say that having a billion high income customers and totally owning your platform experience, as a certain Cupertino based company does, is a much better business model.


        Last time I checked, Apple‘s annual Services revenue was roughly the same as Huawei’s entire consumer business (!) revenue.


        Huawei doesn’t own their core technology (Android) and they don’t own or control the ecosystem in any way.


        It’s Google who owns it and who also owns the customers and their data. Google also collects all the money from Play store.


        Android is indeed a great business if you look at volumes, but it’s way more complex than that.

        • Avatar

          wright_is

          In reply to xamzara:

          I always find it interesting that people judge how well a company does not on its products or services, but on how much it can rip its customers off for.

          • Avatar

            xamzara

            In reply to wright_is:


            I always find it amusing when people say Apple rips off their customers, not considering the product itself and the value it offers.


            For each Apple product there are numerous (often cheaper) alternatives.


            Yet people willingly spend their money on Apple products, again and again.


            Price and value are separate things.


            iPhone, for example, is actually pretty good value. Yes, the high end models are expensive, but with one battery swap you can use it for half a decade, always with the latest software.


            The cost per year ends up being quite fair, actually.


            (And yes, my four year old 6s runs iOS 13 perfectly fine.)


            Also, the base model iPad is shockingly great value. There simply is no viable competition. The same can be said about the Watch. Even AirPods aren’t actually that pricey when compared to competition.


            So much for ripping off people.

            • Avatar

              wright_is

              In reply to xamzara:

              You make my point for me. Just because Huawei isn't charging a fortune for its products doesn't mean it isn't a well run company or that its products aren't good.

              You were quick to defend Apple, who I never mentioned, there are many companies with similar practices. But a company that is making good money and services billions of customers with cheap(er) and reliable products isn't considered successful, because its profit per customer is much lower.

              The Apple products I purchased lost support much quicker than expected. I bought a 2007 iMac, which lost Apple support in 2014, the Microsoft Windows on it will get another update this month... The same for the Mac mini, it support. My 2010 Apple TV didn't even last that long, it was dropped from support after about a year or so. My iPhone 3GS faired a little better, but not great.

              Most people I know buy under 250€ phone and expect it to last 7 years. They lose support quickly, but they continue to use it, until it breaks. It doesn't matter if the iPhone gets security updates for longer, if they can't afford it.

              • Avatar

                xamzara

                In reply to wright_is:

                I’m not saying that Huawei isn’t successful. 


                (But we know little of Huawei’s real financials and the magnitude of Chinese state’s involvement regarding subsidies and so on.)


                I was just saying that their business model (in mobiles) isn’t really that amazing.


                Sell lots of cheap hardware built from commodity parts and commodity software at thin margins...but then what? It really isn’t very different from what PC OEMs do. 


                Apple on the other hand, sells lots (but not as many) of hardware at healthy margins to generally high income customers, who then also use (and pay for) Apple services / AppStore and buy additional “accessories” such as AirPods and Watches. 


                Apple has chosen very much an opposite business model - one which no one has been able to replicate and which (so far) has been incredibly successful.


                It doesn’t matter if everybody can’t afford an iPhone. Apple is choosing their customers - as is Huawei.


                • Avatar

                  yangstax

                  Huawei has just one businesss model - R&D, R&D, R&D and until it becomes so scary. Among their 194K total employees, 96K are R&D scientists and engineers. Huawei is an employee owned company and they are not working for stock holders. You have seen the results in recent years. Their R&D expenses are higher than Apple and Intel combined. Can you blame them for trying to be good? Can't stop them, ban them. Trump figures out a way - 'national security' of course.
            • Avatar

              yangstax

              For each $800 iPhone made, Chinese manufactures get $25, $375 for the phone parts and $400 for Apple and its shareholders. Trump claims that China is ripping off American. People still defends Apple. Sigh!

  3. Avatar

    SimJeff

    When you travel outside of the states the advertising and use of Huawei products seems everywhere.

    If it is just a political pawn in the battle - it seems to be only an issue in one place.

  4. Avatar

    brduffy

    This company gets an awful lot of attention on this site for a product that has less than 10% US Market share. I don't know anyone who uses their phones or laptops. Do we really care?

    • Avatar

      lvthunder

      In reply to brduffy:

      Well this site's audience isn't 100% US based. Plus I think this company interests Paul because the US government is against it.

      • Avatar

        Paul Thurrott

        This company interests Paul because they are the number two smartphone maker in the world and because they make the very best cameras in the smartphone market. That the US government is attacking them is interesting and weird. It would be just as interesting if it was Samsung. And less interesting if it was some company that doesn't matter in my world.
    • Avatar

      wright_is

      In reply to brduffy:

      Given that it is the number 2 smartphone producer and is a leader in 5G technology, it certainly deserves its coverage. That it can reach the number 2 position in smartphone sales, without much impact on the US market says a lot for it.

      Don't forget, a lot of readers here don't live in isolation in the USA, there is a large international audience. For us Huawei is very relevant.

  5. Avatar

    gartenspartan

    I think the US government will eventually regret it if Huawei is able to do all of it's business without the need for any american software or equipment. Especially if trade was a large motivation to try and hurt Huawei and therefore China. In the long run, it will hurt google, qualcomm and other manufacturers who deal with Huawei when they come up with all of their own solutions.

  6. Avatar

    glenn8878

    The other unmentioned company is Apple who sell its own smartphone platform for years. No one needs Android. If Microsoft wants to get back into the business, then it should learn from Huawei.

  7. Avatar

    Chris Payne

    "Huawei won over 5G-related contracts in 2019"


    Was there supposed to be a count in that sentence? Or was it intended to be used like "Microsoft won over consumers with their mobile phone offerings" or "Satya Nadella won over critics by shuttering Cortana?"


    I ask because the following sentence gives a count for Ericsson.

  8. Avatar

    Philip

    I was wondering about the missing number in "Huawei won over 5G-related contracts in 2019". I searched and found that it was over 50 as of September.


    I also found the sentence identically written at techmirror.com. It is actually this entire post with no mention of Thurrott. The only attribution is a "source link" that brings you back to this page. Is that copyright infringement or do you have to put a copyright notice on every article?

    https://www.techmirror.info/huawei-shipped-240-million-smartphones-in-2019/

  9. Avatar

    johnh3

    Huawei phones are popular devices in Europe. But I think if the Android ban will not be solved other brand will take its place in 2020. Like Xiaomi, OnePlus Nokia etc..


    And Samsung and Apple will remain the top seller.


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