Huawei Overtakes Microsoft In The Smartphone Market

Microsoft displaced by Huawei due to its poor performance in the Smartphone market

It looks like Microsoft is never short of competition. First, it was competing against Apple and Samsung in the smartphone market. Now, it has one more competitor added to that list: Huawei.

According to Strategy Analytics, when Microsoft purchased Nokia, it had captured a sizable amount of the smartphone business market. However, with the downfall in the business after the purchase, Microsoft has not been able to make a mark in the smartphone market.

As a result, Huawei just displaced it as the world’s third largest mobile phone vendor by shipping 30.6 million phones, which is close to 50 percent more than last year. On the other hand, Microsoft’s global mobile phone shipments grew only 2 percent year-over-year to hit 435 million units in the second quarter of 2015.

Huawei now holds a record 7 percent market share trailing behind Apple (10 percent) and Samsung (20.5 percent). Microsoft has been pushed down to the fourth place after selling 27.8 million phones, nearly half the 50.3 million devices it sold last year over the same period. The Chinese smartphone maker, Xiaomi is in the fifth position.

Woody Oh, Director at Strategy Analytics said “Global mobile phone shipments grew a lackluster 2 percent annually from 428 million units in Q2 2014 to 434.6 million in Q2 2015. Smartphones accounted for eight in 10 of total mobile phone shipments during the quarter. The 2 percent growth rate of the overall mobile phone market is the industry’s weakest performance for two years, due to slowing demand for handsets in China, Europe and the U.S.”

According to Neil Mawston, Executive Director at Strategy Analytics said Samsung continues to rule the mobile market in spite of the fall in its profits by 7 percent year-over-year.

In comparison to 95 million phones that were shipped in the second quarter of 2014, Samsung could manage to ship only 89 million phones in the same period this year, which gives the Korean company a 20 percent market share.

“Samsung has stabilized volumes in the high-end, but its lower-tier mobile phones continue to face intense competition from rivals such as Huawei in Asia,” Mawston said. “Apple grew 35 percent annually and shipped 47.5 million mobile phones for 11 percent worldwide market share in Q2 2015. Apple outperformed as consumers in China and elsewhere upgraded to bigger-screen iPhone 6 and 6 Plus models.”

On the other hand, Ken Hyers, Director at Strategy Analytics, talking about Huawei said that the company in the second quarter of 2015 had shipped 30.6 million mobile phones.

“Huawei is rising fast in all regions of the world, particularly China where its 4G models, such as the Mate7, are proving wildly popular,” he said. “Huawei has finally overtaken Microsoft to become the world’s third largest mobile phone vendor for the first time ever.”

In comparison to Huawei, Microsoft could manage to ship only 27.8 million mobile phones, which guaranteed it only 6 percent of market share in the world for the second quarter of 2015. Pointing at Microsoft’s 6 percent global mobile phone market share, Mawston said that the company has hit an all-time low.

He said that Microsoft is partly not able to capture market due to the limitations on the feature phone front. However, its Lumia smartphone model continues to hold its position in the market and is awaiting the launch of new Windows 10 models.

When Roger Entner, principal analyst at Recon Analytics was contacted by NewsFactor to share his thoughts on Microsoft’s decline, he said he was not surprised by it.

“You have the rapidly growing Chinese market and the international market and Huawei has been very aggressive,” said Entner. “As we’ve seen with the most recent announcement from Microsoft, they have been less than successful and are pulling back. That’s just the natural result. I would expect Microsoft’s slide to probably continue.”

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