The Shenzhen-based firm has targeted a significant increase in its share of China’s smartphone and telecoms network equipment markets to help offset potential losses overseas because of that US action, according to people familiar with the matter.

Smartphones under the company’s Huawei and Honor brands were ranked No 1 and No 3, respectively, in terms of sales volume from June 1 to June 18 on JD.com, operator of China’s second biggest e-commerce platform. Honor, the budget line of Huawei that is mainly sold online, dominated smartphone sales on JD.com, with seven different models ranked on the retail platform’s top-12 list during the midyear shopping event.

Huawei has continued to lead and expand its share in the world’s largest smartphone market, despite the US trade ban that bars the company from buying major American technologies like semiconductors and software, according to Zaker Li, a senior industry analyst at research firm IHS Markit. Smartphones contributed more than 50 per cent of Huawei’s total revenue last year.

“Huawei smartphones acquired an unprecedented 36 per cent market share in China in the first quarter, and that number is likely to exceed 40 per cent by the end of this year,” Li said. That surge, he added, would put further pressure on Huawei’s main Android smartphone rivals in the country – Xiaomi Corp, Vivo and Oppo. He said news about the US campaign against Huawei has served as the best promotion for the company, encouraging more consumers on the mainland to buy its devices.

Huawei declined to comment for this article.

China Mobile, the world’s largest wireless network operator, announced on June 6 a part of the results of its initial 5G network tender covering 40 cities, in which Huawei was awarded 49 per cent of the MME/SGSN equipment contracts and 54 per cent of the SAE-GW/GGSN orders. MME/SGSN provides optimisation and control of device signalling in a 5G network, while SAE-GW/GGSN is responsible for management and delivery of data traffic.

“Huawei is one of our major long-term suppliers and over the years, it has consistently provided us with exceptional products and services,” China Mobile said in an emailed statement after announcing those results.

While the announced segments of that 5G tender represented a small chunk of the total project compared with base stations, it was “highly indicative of how the entire Chinese market will be divided”, according to Hosuk Lee-Makiyama, director of the European Centre for International Political Economy in Brussels.

“Early industry intelligence foretells [the overall] result in which foreign vendors may be down to a single-digit share of the tender,” he said. “The market shares of European vendors have drastically shrunk in China the past five years and bottomed out at less than 20 per cent of the market.”

The stakes are high for privately held Huawei to make the most out its China focus because the US trade ban is expected to wipe out US$30 billion of sales growth.

“If the US export ban continues, Huawei will not be able to license any Google apps on its smartphones, nor will its phone users obtain any Android update and technical support from Google,” Jefferies equity analyst Edison Lee said in a recent report. “Therefore, it will likely lose the bulk of its overseas handset sales since foreign smartphone users rely heavily on Google apps.”

The telecoms gear maker is also facing a string of US charges, including accusations that the company stole trade secrets, violated economic sanctions and concealed its Iran business dealings via an unofficial subsidiary. Huawei has repeatedly and vehemently denied those charges, citing the US government’s lack of evidence.

Those setbacks for Huawei have come as trade tensions between the US and China keep Washington and Beijing apart from reaching a comprehensive agreement on tariffs and market access between the two countries.

While Jefferies’ Lee described Huawei’s guidance as “a dangerous signal for the global communications equipment supply chain”, some of Huawei’s American hi-tech suppliers have found a way to get around the US trade ban.

That augurs well for Huawei’s intensified sales push in China, which included campaigns for other products and services.

Laptops, a field where computer maker Lenovo Group leads in China, have become a strong part of Huawei’s product portfolio. On June 18, at the peak of the midyear 618 shopping festival, Huawei’s laptop sales in the first two minutes surpassed the whole-day sales of these devices a year ago on popular online shopping platforms Tmall and JD.com, according to the telecoms gear maker’s estimates.

Huawei has also ramped up sales in China’s video surveillance equipment market, where it sells a range of artificial intelligence-enabled cameras that support face scanning, vehicle recognition and monitoring under extreme weather.

That development raised Huawei’s profile as a potentially strong competitor to Chinese surveillance systems giants Hangzhou Hikvision Digital Technology and Dahua Technology.

Huawei became more visible and aggressive in competing for government contracts from last year, according to a Dahua engineer who wanted to remain anonymous.

Meanwhile in May, Huawei further burnished its credentials in the surveillance systems market with the launch of a new cloud service on the sidelines of the Guiyang Big Data Expo, held in the capital of Guizhou province in southwestern China.

The platform can support real-time monitoring and automatic alerts during emergencies, including a sudden surge of people at a public gathering. It could help prevent tragedies like the New Year’s Eve stampede in Shanghai in December 2014, when 36 people were killed and dozens were injured, according to Liang Ke, a Huawei big data management specialist in corporate technology services.

Huawei, which is also a large manufacturer of custom-designed servers for enterprises, also runs an extensive cloud computing services operation that is backed by a network of data centres built across the Asia-Pacific, Europe, Africa and South America.

“Smart video surveillance needs machine learning and applications development capabilities in the cloud,” said Charlie Dai, a principal analyst at research firm Forrester.

Forrester’s Dai said Huawei’s investments in cloud computing and so-called Internet of Things give it a unique advantage, differentiating it from other vendors of telecoms and surveillance equipment.

So there is much that Huawei can do if it turns inward.

However, the company’s long-term business prospects will still rest on how, when and if Washington and Beijing can finally settle, or at least de-escalate, their trade and tech differences.

Additional reporting by Yingzhi Yang