Huawei may be set for a smartphone comeback

Chinese telecoms giant Huawei is aiming to double its smartphone shipments, having reportedly hoarded massive reserves of components despite US sanctions.

So claims Nikkei Asia, which quoted a pair of unnamed industry executives saying that the Chinese kit maker is shooting for 60 million-70 million smartphone shipments in 2024.

As well as stocking up on things like lenses, cameras, printed circuit boards and other smartphone parts over much of this year, the news outlet claims Huawei also asked Qualcomm to ship its full-year chips order by June, just in case the US were to introduce further export controls. Qualcomm is Huawei’s only US-based supplier of 4G chips, it notes.

Nikkei cites figures from IDC that show Huawei shipped just 30.5 million smartphone units last year, putting it tenth place in the global ranking. Indeed, the analyst firm’s data for full-year 2022 shows that Huawei was well eclipsed by domestic rivals Xiaomi, Oppo and Vivo. That’s a sharp contrast to its position in 2019, prior to the US sanctions, when its shipments peaked at 240.6 million and ranked second in the world.

“Huawei is aiming high in the next two years, and we expect them to move upward on the back of domestic demand cheering on their hometown hero,” Bryan Ma, vice president of device research at IDC, told the news outlet.

He predicted that Huawei will likely take some market share from Apple in the premium phone segment in China, but also cautioned that the threat of component shortages still looms as a result of tensions with the US.

Indeed, there are reports that the US plans to widen its export controls and licences granted by the US government to Huawei itself and to chipmakers like Semiconductor Manufacturing International Co (SMIC) – whose capacity to manufacture 5G and other high-end chipsets in Shanghai is growing – are under threat.

Earlier this week it emerged that the US had made further concessions to allow exports of its semiconductor manufacturing equipment to Samsung Electronics and SK Hynix factories in China without a separate approval process, a move that surely triggered some optimism among those affected by US controls.

However, with a number of US politicians urging the government to treat export controls as a national security tool and use them accordingly, any respite could be short lived. And that would of course be a problem for Huawei and its compatriots.

The upshot is that with such an unpredictable global situation – or, the inability to look long-term at the tensions between Washington and Beijing – Huawei can make as many predictions as it likes about smartphone shipments, but the outcome is far from being in its own hands.

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