Huawei Gains, Apple Fades in China -- WSJ
February 13 2019 - 3:02AM
Dow Jones News
By Dan Strumpf
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (February 13, 2019).
HONG KONG -- iPhone shipments in China slumped far more than
overall smartphone shipments there last quarter, costing Apple Inc.
further ground against local rival Huawei Technologies Co. in the
world's biggest smartphone market.
Apple's smartphone shipments in China in the last three months
of 2018 were down 20% from a year earlier, according to
International Data Corp., putting a finer point on Apple's
shrinking sales in China late last year. Last month, Apple CEO Tim
Cook blamed declining iPhone sales in China on the economic
slowdown there.
That slowdown -- and a global trend among phone owners of
upgrading less frequently -- contributed to a 9.7% drop in overall
smartphone shipments in China in the quarter. Apple's decline sent
its China market share falling to 11.5% from 12.9% a year ago,
according to IDC. Apple, now the fourth-biggest vendor in China,
was the country's top smartphone seller as recently as early
2015.
Huawei's shipments were up 23%, giving it 29% of the market and
cementing its position as the country's top phone vendor, according
to IDC, which reported Huawei also gained at the high end of the
market long dominated by the likes of Apple.
"The high price point of the iPhone X in 2017 has lengthened the
replacement cycle of users, while the new models of 2018 don't have
enough innovations to make users buy," said Xi Wang, an IDC analyst
in China. Huawei, by contrast, has taken technological strides that
have made its devices more competitive in photography, gaming and
business applications, he said.
Though its phones are virtually nonexistent in the U.S.,
Huawei's global smartphone shipments were up a heady 44% in the
fourth quarter, according to IDC, which ranks it the No. 3 vendor
world-wide last year. It still trailed Samsung Electronics Co. and
Apple in global sales for the year.
Fourth-quarter shipments in China were also up for other local
brands, including BBK Electronics Corp.'s Oppo and Vivo. Chinese
companies are succeeding by offering lower prices and technology
geared toward local buyers, analysts say.
But shipments by China's Xiaomi Corp. -- which raised $4.7
billion in a Hong Kong initial public offering last year -- were
down 35% in the fourth quarter, according to IDC, which pointed to
too few new products and disappointing sales of its flagship Mi Mix
3 smartphone.
The smartphone success is a rare piece of good news for Huawei.
In December, Canadian authorities arrested its CFO on charges
relating to evasion of U.S. sanctions on Iran. It is also fighting
separate U.S. criminal charges that it stole intellectual property
from T-Mobile US Inc. Huawei has denied all charges against it.
Meanwhile, the U.S. is lobbying allies to bar their telecom
operators from buying 5G networking equipment from Huawei, which is
the world's largest maker of items such as base stations, routers
and switches.
Huawei has pressed ahead with a series of high-end phone
launches that have helped it gain ground on Apple. The unveiling of
a foldable 5G-ready phone is widely expected at a mobile industry
event in Barcelona late this month.
Write to Dan Strumpf at daniel.strumpf@wsj.com
(END) Dow Jones Newswires
February 13, 2019 02:47 ET (07:47 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Apple (NASDAQ:AAPL)
Historical Stock Chart
From Mar 2024 to Apr 2024
Apple (NASDAQ:AAPL)
Historical Stock Chart
From Apr 2023 to Apr 2024