One of the biggest issues faced by the smartphone market in 2020 was the tightening of US trade sanctions against Huawei. The company, which had maintained its global market share for a while by increasing its share in China in the early days of the sanctions, started showing a decline from the fourth quarter of 2020. By the end of Q1 2021, its share had reached 4.6%. However, Huawei’s installed base share was still at 9.7% in March 2021. This indicates that the decline in installed base will show up later than sales drop.

Huawei Flagship (P Series and Mate Series) Strategy

Huawei is responding to the component shortage by focusing on its high-end flagship devices. Huawei’s sales have declined sharply since the fourth quarter of 2020, but the sales of its flagship series, the P Series and Mate Series, remained above 10 million units in the same quarter. Flagship sales fell to 7 million units in the first quarter of 2021 due to limited product supply. This is the first quarter in four years to show under-10 million sales ever since surpassing the 12-million mark in the fourth quarter of 2016. This decline in flagship sales has not yet been seen in the installed base data. Huawei’s flagship product installed base maintained a 36% share in March 2021, which is the same as in March 2020. However, if Huawei’s bad performance continues in the long run, this decline will also reflect in the installed base.

Huawei’s Top 5 Models by Installed Base

Huawei’s Top 5 models by installed base show setbacks for its flagship sales. In March 2020, all three P30 series models, which had been in the market for about a year, entered the Top 5 list. But in March 2021, the P40 series failed to make it to the list. Instead, the P30 series grabbed the Top 3 spots. This is because P40 models can’t have GMS (Google Mobile Services) due to US sanctions, limiting their sales outside China. Counterpoint Research Top 5 Huawei Models by Installed Base, March 2021

Counterpoint Research Top 5 Huawei Models by Installed Base, March 2021

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