Xiaomi’s Smartphone Strategy Under Scanner

Xiaomi’s numbers for the third quarter show the impact of the ongoing global component shortages on its balance sheet. Revenues grew just 0.5% YoY and plunged 19% QoQ, while quarterly sales growth was slowest in more than a year. All this has prompted many to question Xiaomi’s business strategies. But Xiaomi is already at work, picking areas for improvement and finding ways to tackle external factors.

Xiaomi’s Global Smartphone Shipment Share
Source: Counterpoint Research Smartphone Tracker

Xiaomi was the first OEM to bet big on combining internet characteristics with consumer electronics, especially e-commerce. The way the company built the connection between the brand and the consumer conveyed that it wanted to cut hardware and channel margins as much as possible. This was indeed a disruptive strategy for the market 10 years ago. Other OEMs in China were forced to adopt the same strategy. If we look at this 10-year period, this is how leading smartphone OEMs have survived:

  1. Adopted the internet brand strategy, where online-centric brands were launched. Examples: Xiaomi, realme, OnePlus.
  2. Adopted the internet brand strategy while leveraging the offline networks at the same time. Example: HONOR.
  3. Continued the offline strategy while targeting a decent pie of internet sales at the same time. Examples: OPPO, vivo.

Xiaomi, with its strong value-for-money and predominantly below-$300 product portfolio, has grabbed a huge market share globally, especially in the past three years. This is due to two main reasons.  First, Xiaomi has managed to take a big share from the local brands, which were mainly getting their supplies from Chinese ODMs and, therefore, lacking in pricing advantage and core competency in software. Second, the local OEMs are not in a position to match Xiaomi’s marketing muscle. Therefore, with the right kind of penetration strategy, it can be a very potent mass market alternative. But today, other players too are playing the same “internet brand” game as Xiaomi and are close behind.


Xiaomi’s China Smartphone Shipment Share
Source: Counterpoint Research Smartphone Tracker

What has caused Xiaomi’s undulating performance in the past few quarters? Globally, Xiaomi experienced the ongoing SoC shortage, as was mentioned in its latest quarterly earnings call. Xiaomi’s main shipment contributors are 4G-enabled smartphones, especially those below $300. 4G SoCs also happen to be the ones facing the biggest shortage gap in smartphones.

In Xiaomi’s home country, China, it continued to struggle in the offline market. OPPO and vivo held more than 65% share in the offline market, while HONOR’s strong return meant a huge impact on Xiaomi. In Q2 2021, with the big e-commerce festival of “618”, Xiaomi beat expectations. But in Q3 2021, there was no such festival, which led to Xiaomi’s underperformance. Xiaomi has been working to overcome downsides:

  1. It is working to ease component shortages, especially in SoCs.
  2. It is trying to raise its ASP by targeting the mid-to-high segment.
  3. It is doing offline channel mapping to better target the segment, though this segment takes time to produce results.

Xiaomi will perform much better in online sales in Q4 2021 when two big e-commerce festive sales of Singles’ Day (11.11) and Double 12 take place.

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CIS Holds Key to Xiaomi’s Q2 2021 Europe Smartphone Success

Boston, Toronto, London, New Delhi, Beijing, Taipei, Seoul – August 18, 2021

Erratum: this is an update to a previous PR that was based on preliminary data. Our updated analysis shows that Samsung actually remained the number one in Eastern Europe ahead of Xiaomi.

There is no denying Xiaomi’s meteoric rise in Europe. In Q2 2021, Xiaomi overtook Samsung to became the largest smartphone vendor in terms of shipments in Europe, including Russia and CIS countries. This is, of course, a fantastic achievement for Xiaomi, made even more impressive by the fact that Xiaomi only entered the European market in November 2017. However, the story is a little more complex than the headline numbers suggest.

Initially it appeared that Xiaomi had taken the lead in both Eastern Europe and the CIS countries, but closer inspection revealed that Samsung still held on to Eastern Europe. This paints an even more interesting picture. The top three vendors in Europe each took the top spot in the three sub-regions: Apple in Western Europe, Samsung in Eastern Europe, and Xiaomi in Russia and CIS.

Given the size of Russia (it is by far the largest smartphone market in Europe, with almost double the shipments of the second largest, Germany), it skews the data somewhat. With Russia and CIS included, Xiaomi is the new top vendor in Europe; taking Russia out of the equation, Samsung remains number one.

Exhibit: Top smartphone vendors by European sub-region, Q2 2021

Source: Counterpoint Research Market Monitor, Q2 2021

Europe is not a one-size-fits-all region

According to Counterpoint Research’s Associate Director, Jan Stryjak, “Europe is an incredibly diverse region, with a mixture of both highly advanced and developing markets. It is therefore important to consider the different sub-regions when assessing market trends, and look at how different vendors have found varying levels of success in different markets.”

  • Samsung, which probably has the widest reach and broadest portfolio of all the vendors, is the previous market leader when looking at the region as a whole, and only lost its top spot after Covid-19 related factory shutdowns impacted supply in May and June 2021. Nevertheless, Samsung is still the number one in many European markets, for example Poland, where it accounted for 42% of smartphone shipments in Q2 2021. Samsung was also the number one smartphone vendor in Q2 2021 in countries as diverse as Italy, Greece, the Netherlands, Norway, Portugal and Romania.
  • Apple, being a high-end brand, tends to do better in Western Europe, and particularly in more premium markets like the UK, where it held 44% share in Q2 2021. Apple was also the top vendor in Austria, France, Germany, Hungary, Sweden and Switzerland.
  • Xiaomi has gained the most from Huawei’s decline over the last 12-18 months, and has done well in more price-conscious markets like Spain, where it accounted for 40% of smartphone shipments in Q2 2021. Xiaomi was also number one in Belgium, Denmark, Russia and the Ukraine.

Stryjak added, “Looking forward to Q3, we expect Samsung to recover the top spot in Europe, having resolved its supply issues in Vietnam. Its low- to mid-range A series continues to sell very well across the region, and the launch of its foldable range should give the premium tier a boost too. Having said that, Xiaomi will likely continue to lead in markets like Spain and Russia, while Apple is unlikely to be unseated as market leader in Western Europe. So it is still all to play for, and will make for a very interesting second half to the year.”


Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Jan Stryjak


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Monthly Pulse: Xiaomi Becomes #1 Smartphone Brand Globally for First Time Ever

• This is the first time ever, in June 2021, Xiaomi has become the number one brand in global monthly smartphone sales (sell-through) volumes

• While this is a great feat for Xiaomi, it could prove to be temporary once Samsung’s production recovers from Vietnam’s COVID-19 wave, but the race has gotten close

Seoul, Taipei, Beijing, London, Boston, Toronto, New Delhi, Hong Kong – August 5, 2021

Xiaomi surpassed Samsung and Apple in June 2021 to become the number one smartphone brand in the world for the first time ever, according to Counterpoint Research’s Monthly Market Pulse Service. Xiaomi’s sales grew 26% MoM in June 2021, making it the fastest-growing brand for the month. Xiaomi was also the number two brand globally for Q2 2021 in terms of sales, and cumulatively, has sold close to 800 million smartphones since its inception in 2011.

Exhibit: Global Monthly Smartphone Sales Share Trends (%)

Global Smartphone Sales Share by Brands #XiaomiTops

Source: Counterpoint Research Monthly Market Pulse, July 2021

Commenting on the market dynamics that led to Xiaomi attaining pole position, Research Director Tarun Pathak noted, “Ever since the decline of Huawei commenced, Xiaomi has been making consistent and aggressive efforts to fill the gap created by this decline. The OEM has been expanding in Huawei’s and HONOR’s legacy markets like China, Europe, Middle East and Africa. In June, Xiaomi was further helped by China, Europe and India’s recovery and Samsung’s decline due to supply constraints.”

Commenting on the China market and Samsung supply constraints, Senior Analyst Varun Mishra said, “China’s market grew 16% MoM in June driven by the 618 festival, with Xiaomi being the fastest growing OEM, riding on its aggressive offline expansion in lower-tier cities and solid performance of its Redmi 9, Redmi Note 9 and the Redmi K series. At the same time, due to a fresh wave of the COVID-19 pandemic in Vietnam, Samsung’s production was disrupted in June, which resulted in the brand’s devices facing shortages across channels. Xiaomi, with its strong mid-range portfolio and wide market coverage, was the biggest beneficiary from the short-term gap left by Samsung’s A series.”

Going forward, if the situation in Vietnam does not improve, Samsung’s production is likely to remain hit with Xiaomi continuing to gain share from the Korean brand. However, once Samsung recovers, the ranks are likely to shuffle again.

Please reach out to press (at) for press comments and enquiries.

You can also visit our Data Section (updated quarterly) to view the smartphone market share for WorldUSAChina and India.

Some of our other smartphone market analyses for Q2 2021:


Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (Technology, Media and Telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts: 

Varun Mishra


Tarun Pathak


Follow Counterpoint Research


Combined Global Market Share of Huawei, OPPO, Vivo, Xiaomi and Realme Reaches Highest-Ever Level in Q2 2019

Overall smartphone shipment declined 1% in Q2 2019, making it the seventh consecutive quarter of declining shipments.

Huawei’s shipment ban hurt it in overseas markets, but domestic market growth offset some of the pain. 

Realme entered the top 10 brands for the first time.

New Delhi, Mumbai, Hong Kong, Seoul, San Diego, London, Buenos Aires – July 31st, 2019

The combined global smartphone market share of Chinese majors Huawei, OPPO, Vivo, Xiaomi, and Realme (HOVXR) reached 42% in Q2 2019, the highest it has ever been. This was even as global smartphone shipments fell 1.2% year-on-year (YoY) to 360 million units during Q2 2019, making it the seventh consecutive quarter of decline.

Commenting on the record market share for HOVXR, Varun Mishra, Research Analyst at Counterpoint Research noted, “Heavy marketing, faster portfolio refresh, high spec devices at aggressive prices, and multi-channel presence are some of the key reasons why Chinese brands fared better than the local and global OEMs. These brands have been aggressively expanding outside China and achieving growth offsetting the saturation in their home market. Their strategies and product portfolios are more aligned to the local needs and preferences, which is one of their key strengths.”

Exhibit: Smartphone Shipment Market Share 2019 Q2

Source: Counterpoint Research: Quarterly Market Monitor Q2 2019

The smartphone market slowdown is mainly due to China, which has continued to decline for two years now. China alone accounts for over one-fourth of the global smartphone shipments and declined 9% YoY during the quarter. The heightened US-China trade war during the quarter has further escalated the uncertainties of the smartphone market. India remains a key growth market as the shipments set a second-quarter record,

Commenting on the trade war Tarun Pathak, Associate Director at Counterpoint Research, said “The US-China trade war escalated with Huawei added in the entity list in May. Despite the ban, Huawei was able to register a 4.6% growth during the quarter, capturing a 16% market share. The effect of the ban did not translate into falling shipments during this quarter, which will not be the case in the future. In the coming quarters, Huawei is likely to be aggressive in its home market and register some growth there, but it will not be enough to offset for the decline in its overseas shipments. This will further lead to the decline of the overall smartphone market in 2019. However, the gap created in the market by Huawei gives a window of opportunity to other OEMs, especially Samsung, to leverage.”

A portion of the decline in 2019 is likely to be compensated by the adoption of 5G.

Commenting on 5G, Varun Mishra, added We expect that 5G will have a faster rollout than 4G LTE. Unlike 4G, which was split between FDD-LTE and TD-LTE, 5G has a universal standard, which will make the ramp-up faster. We expect sales of 5G devices to be over 20 million in 2019. Network expansion of carriers, subsidies, and more OEMs committing to early 5G device launches than during the early 4G era Since these devices are expected to be limited to the premium segment in 2019, the adoption will also drive the market average selling price (ASP). Consumers are also expecting to pay higher for the 5G smartphone than what they paid for the 4G device.”

Even though shipments continued to decline, the market ASP is likely to increase, which will drive revenue for the industry. Adoption of 5G in mature economies and the shift from entry-level phones to mid-segment phones in emerging economies will drive up ASPs.

Key Takeaways:

  • Samsung grew 7.1% YoY, capturing over one-fifth of the global smartphone market share. The OEM has completely overhauled its product portfolio in 2019 with its A and M series targeting the sub $300 price segment aggressively. The flagship S series, in which Samsung launched three devices instead of the usual two, covering wider price points also continue to do well. Samsung was also one of the first OEMs to launch a 5G device – S10 5G, which remains popular in the 5G adopting
  • Huawei grew 4.6% YoY, but the US trade ban will its growth momentum, especially in the overseas market. The effect in Q2 2019 was not severe as the order came late into the quarter. The real effect of trade sanction will be in Q3 2019. Shipments in overseas markets are estimated to register a steep decline.
  • Apple iPhone shipments fell 11%, and iPhone revenues fell 12% year-on-year. Despite this decline, iPhone sales trends are improving. Apple’s buyback programs and other marketing are dampening growing holding periods. However, the lack of 5G over upcoming quarters may again increase holding periods.
  • Realme entered the top 10 OEMs globally for the first time. It took Realme only a year to achieve this feat. This is one of the fastest ramp-ups. Strong performance in India and expansion overseas drove its growth. This was also the third consecutive quarter that Realme sold within top 5 brands in India.
  • This was the third consecutive quarter of a decline in Apple iPhone shipments. To ramp up sales, Apple implemented price cuts for the iPhone XR in India and China markets. Amid the slowdown in China and likely launch of 5G capable iPhone in 2020, Apple will have to concentrate its efforts on emerging markets.
  • The market further consolidated with the top 10 brands’ market share increasing to 79% from 76% a year ago.
  • BBK Group is now the second-largest smartphone manufacturer globally.


Analyst Contacts:

Tarun Pathak  
Varun Mishra  
Shobhit Srivastava

Follow Counterpoint Research  

You can also visit our Data Section (updated quarterly) to view smartphone market share Globally and from the USA, China and India

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