Huawei is the present king of the Chinese mobile market. We don’t think it will ever change anytime soon as the company continues to do well in the market. It’s been coming up with more premium models recently. As it turns out, Huawei has been planning on no longer selling low-end phones as it aims to grow shipments and challenge Apple in the premium phone category.
Huawei Technologies is now behind Apple and Samsung at number three in the global market share for smartphones. This year, it targets to sell 150 million units from the 139M target last year. This appears to be ambitious but Huawei has proven that it can keep up with global brands that have been dominating the past decade.
In line with this, the Chinese OEM is believed to be unveiling the new Huawei Mate 10 which is another premium model. Huawei consumer division chief Richard Yu said, “The Mate 10, which has much longer battery life with a full-screen display, quicker changing speed, better photographing capability and many other features that will help us compete with Apple.” The company may have seen some decline in revenue growth last year but interestingly, revenue rose to about 15% to 283.1 billion yuan ($42 billion) in the first half of 2017.
Huawei has been spending more money in 5G research, as well as, marketing maybe that’s why profitability is being affected. There’s nothing to worry though because revenue is still on the rise although not as high or fast as before. The consumer unit of Huawei is only now targeting 25% growth instead of 42% for all the consumer devices including smartphones, tablets, smartwatches, and other accessories.
As for the idea that it will no longer sell low-end devices and where the company will focus more, here’s what Yu have to say, “We are giving up the very low-end devices because the margin in this is extremely low, and it’s not making enough profit for us. The priority is Europe, China and Japan, where the economy is healthy and people are able to consume them.”
Huawei will remain in the business but we’re expecting it to slow down a bit. We think it’s better so it won’t be too much heartbreaking if something unfortunate happens along the way.
VIA: Bloomberg
