Xiaomi edges past Apple in China’s Q2 smartphone sales, as local brands extend lead

PUBLISHED : Wednesday, 26 July, 2017, 12:54pm
UPDATED : Wednesday, 26 July, 2017, 11:11pm

China’s home-grown brands continue to gain ground in the world’s largest smartphone market, pushing aside Apple and Samsung Electronics with their offerings of sophisticated models at reasonable prices.

Huawei Technologies, the world's largest telecommunication equipment manufacturer, shipped 23 million smartphones in China in the three months ended June, becoming the country’s best-selling brand for the second quarter in a row, according to Canalys.

Its P10 smartphone, sporting high-resolution cameras made with Leica, was a bestseller among China’s selfie-loving users, boosting its market share to 20.2 per cent, from 16.9 per cent, according to data from Counterpoint.

Oppo, made by entrepreneur Duan Yongping’s Guangdong Oppo Electronics, shipped 21 million units to secure second place, expanding its market share to 18.8 per cent from 16 per cent.

Vivo, a sibling brand also made by Duan, shipped 16 million units, increasing its market share to 17 per cent, from 13.2 per cent, according to estmates from the two research firms.

Xiaomi was the standout performer in the second quarter, as its direct-to-customer sales method and new models boosted sales by more than 60 per cent, helping it ship 15 million handsets in fourth place.

The improved performance is a vital step in fulfilling Xiaomi founder Lei Jun's target of shipping 100 million smartphones annually by 2018.

“Xiaomi still offers the best value in the Chinese market, and it remains the preferred choice for price-conscious consumers,” Canalys research analyst Lucio Chen said in a report.

“The online channel continues to be a key route to market for Xiaomi, and this quarter saw it take the lead in the 618 online sales events across online retail platforms, such as and Tmall,” said Chen.

Apple has not released smartphone shipment figures for the quarter, although analysts believe its market share on the mainland may have slipped to fifth place, with under 10 million units shipped during the period.

China’s smartphone market continues to consolidate as the top five brands accounted for almost three quarters of shipments, with the top four all growing and adding 10 per cent to their cumulative share compared with the same quarter a year ago, said Canalys, adding that total Chinese smartphone shipments fell 3 per cent to 113 million in the second quarter after six consecutive quarters of growth.

A positive brand image among consumers and active sales channels have enabled first-class brands including Huawei, Oppo and Vivo to continue leading sales in China, said Zhao Ziming, an analyst with Beijing-based consultancy Analysys.

“Although Samsung’s Galaxy S8 flagship models have received overwhelmingly acclaim, it failed to recover from the negative impact of battery defects associated with the Galaxy Note 7 models. As Samsung’s lower-to-medium priced phones are also uncompetitive to Chinese brands, its market is likely to continue to trend lower,” Zhao said.

Apple is not likely to release its latest iPhone models until the autumn this year, setting it apart from other brands which already inroduced new smartphone models in the first half of this year.

The US technology giant is expected to release a special-edition iPhone to mark the 10th anniversary since the first generation model hit the market in 2007.