Chinese mobile phone brand Huawei has revealed it is “back on track” thanks to a strong ending to 2023.

In a new year message written before 2024, Huawei’s Rotating Chairman, Ken Hu claimed the firm’s devices, ICT and cloud divisions performed well last year and expected revenues of 700 billion yuan ($98 billion), compared with 642 billion yuan ($90 billion).

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As a result, he credited the company’s performance to “years of hard work” to “weather the storm”, as it targets “steady and long-term growth” this year.

He said: “Now we’re pretty much back on track. In 2023, we expect to wrap up the year with over 700 billion yuan in revenue.

“Our ICT infrastructure business has remained solid, and results from our device business surpassed expectations. Both our digital power and cloud businesses are growing steadily, and our intelligent automotive solutions have become significantly more competitive.”

Looking forward, Hu revealed Huawei’s cloud business should aim to be “the company’s digital backbone” as he cited an opportunity to facilitate the digital transformation of the industry.

He added: “Our carrier business needs to more effectively support the business success of our customers by helping them boost data traffic, innovate new services, and drive network evolution.”

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Enter Huawei, the controversial telecoms giant which has seen its 5G equipment banned in multiple countries around the world over security concerns and been accused of using its devices and technology to funnel people’s data back to the Chinese government.

“From a marketing point of view, its been really tough. We’ve been a brand that has historically invested a lot throughout the marketing mix. Weve done lots of interesting, innovative, digital, social, experiential things. But weve also done some straightforward out-of-home, cinema, the big, high-profile advertising youd expect. And, in a pandemic, youve got to change all of that. The big thing for us through the course of the last year has been focusing a lot more on reaching our consumers in a more personal way,” says Winston Eavis, Marketing Director for Huawei UK & Ireland.

“In terms of 5G, we’ve done a big job on clearing up confusion. We embedded the fact that we are, as a consumer business, still here and were still selling strongly. Weve got 5m residual customers who love us and keep buying more of our stuff. We did a campaign last year called ‘Here Today, More Tomorrow’, just playing on the ‘here today, gone tomorrow’ that some people might have thought at that point. It was a very simple message with very simple imagery to give people the reassurance that they needed.”

To continue getting the brand across to consumers in a positive way, Huawei has had to diversify the digital and social channels it uses to both capitalise on the growth of certain platforms and to market certain products to audiences that are more likely to be interested.

The company has moved beyond using Twitter, Facebook, and Instagram and entered into the worlds of LinkedIn and TikTok. The focus has been on PCs and tablets on LinkedIn and wearable and audio products on TikTok, catering to the audiences of those respective platforms.

“Weve just done our first paid campaign on LinkedIn with some content around how we donated a tablets and routers to tech-disadvantaged schoolkids in Manchester. We worked with the Greater Manchester Technology Fund and gave out about 250 different packs to kids in some of the neediest schools around there,” says Eavis. “We just did a couple of pieces of content and put them through LinkedIn for that. It’s not massively self-serving, its not all about us. Its much more about the teachers, the kids, and he ambassadors from the Greater Manchester Technology Fund. LinkedIn has been really interesting to get us to a new audience.”

Last year on TikTok, Huawei launched a campaign for its Watch Fit product with influencer Holly H. The campaign saw Holly, as well as some of Huawei’s existing KOL network, post fitness videos to promote the smartwatch across the video sharing app and on Instagram.

“We’ve been looking at TikTok for a long time,” adds Eavis. “It has historically been a very young audience, but I think now that its starting to mature. A lot of our newer products – the wearable stuff, the audio stuff – has a much younger audience than weve been used to. Weve been selling £1000 smartphones or £1500 PCs and that naturally gets you into a slightly older audience. The younger audience is tricky to reach, very attention poor, and very time poor, but they do spend a huge amount of time on places like TikTok.”

Huawei has also looked at taking the diversification of its marketing a little further by looking at channels such as Pinterest, Clubhouse, and Snapchat – which it has previously worked with on filters.

However, according to Eavis, though Huawei is consistently looking at different platforms, the company will not set up a presence on a channel just “for the sake of it”.

“Pinterest is really interesting. We looked at it last year. We also did a test with Snapchat, and were looking at Clubhouse at the moment. Although, commercially, its difficult to know how Clubhouse could really work. We’re always evaluating new platforms,” explains Eavis. “Pinterest is a very visual platform. For us, having built up such a great Instagram community, were struggling to think about how we could differentiate ourselves.

“If we go into a new channel, we try to do it really meaningfully. We want to make sure that were not just there maintaining a page. We want to see what it adds to our brand.

“Its definitely not just sinking all our money into TikTok, were definitely looking across the board.”

Though TikTok is the platform where Huawei sees the biggest opportunity and the company has committed heavily to social channels in general, it has also been exploring other avenues including the worlds of podcasts and PR.

The brand recently started its own podcast with a few Huawei insiders discussing the business, what’s coming up, and the industry as a whole.

“Podcasts are quite interesting. It’s difficult to do something meaningful that actually offers benefits to people, but I do think theyre going to be a continual growth area. I think people find a certain peace and solace in podcasts. So, thats something were thinking about and looking at,” says Eavis.

The company also worked Esquire and Men’s Health on a campaign around the GT 2 Pro fitness watch last year. Huawei provided some of the publications’ deputy editors with devices for them to try out and provide their thoughts.

“I’m really interested in in the way that PR is starting to really blur the lines of advertorial and paid media. And news and editorial publishers have got an interesting job to do to think about how they embrace their editorial credibility, while also opening up opportunities to get yourself into that as a brand,” Eavis adds.

“I think thats something well do more of. It’s something that feels very credible, very relatable, and it gets you to an audience that you cant really get through traditional ATL.”

For Huawei, 2021 looks set to be just as busy as 2020, especially with more products on the horizon. The release that is probably most highly anticipated is the launch of Harmony, Huawei’s own operating system.

HarmonyOS, which can be expected sooner rather than later, will work across Huawei’s devices, connecting the company’s smartphones, TVs, PCs, smartwatches, earbuds etc.

“By this time next year, were going to be living in very much a harmonyOS world and driving everything through that platform. And thats going to mean new ways of communication,” says Eavis. “There’s not that many platforms that are particularly good at educating people at scale, it’s a difficult thing to do. So, thats one of our big challenges and another reason were looking into areas like LinkedIn a bit more, because there you can get a bit more dwell time, a bit more longevity, and a bit more understanding. Some of our other platforms are just a little bit quicker in their attention span.”

In spite of all of the above, Eavis concedes that it’s the products and the consumers that are driving force behind Huawei’s success.

“We’ve done lots of smart advertising and smart marketing and good PR and all of the things that youd expect us to do as a brand. But you cant do it without people really loving your products. Im more delighted by the fact weve got millions of consumers who, with the best will in the world, often do our job for us,” concludes Eavis.

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The 5G mobile private network within Cambridge University’s Science Park – which will go live in January 2021 – will enable businesses to undertake research and application in areas such as autonomous vehicles, clean energy, and remote surgery.

“Huawei’s success is built on a relentless drive for innovation and we are able to keep pushing the boundaries of technology when we partner with those who share this ambition,” said Victor Zhang, Huawei Vice President. “The Cambridge ecosystem is recognised as a global leader in technology and we are excited to work with the talent and vision in this eco-system. We hope to enable Cambridge Wireless members to reach new heights by allowing them access to our state-of-the-art equipment and markets including China and beyond. Our commitment to the UK and industry remains as strong as ever and we will continue to offer our expertise and technology to our partners to promote connections and innovation.”

The three-year partnership between Huawei and CW will also involve digital training, business support, and joint events.

“We are constantly working to provide value to CW members,” said Simon Mead, CEO of CW. “As home to one of the world’s most advanced R&D ecosystems, Cambridge is perfectly positioned for the rollout of next-generation wireless technology and we’re delighted to be driving this initiative with our partners. We hope to bring something unique to the Science Park to accelerate use cases and development of this technology. We invite ambitious businesses to get involved and through this exciting 3-year partnership with Huawei, we will support their 5G innovation journey.”

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The handset maker that appeared to suffer the most in the period was Samsung, according to Gartner. The South Korean tech giant saw the largest decline in sales among the top five smartphone makers, seeing its sales slip by 27.1 per cent from Q2 2019 to 55m. Despite this, it still – just about – kept its place as the number one smartphone vendor.

“The COVID-19 pandemic continued to negatively affect Samsung’s performance in the second quarter of 2020,” said Anshul Gupta, Senior Research Director at Gartner. “Demand for its flagship S Series smartphones did little to revive its smartphone sales globally.”

Huawei, though seeing its YoY sales drop by 6.8 per cent to 54m, came pretty close to Samsung in the race for the number one spot. Quarter-over-quarter, it experienced growth of 27.4 per cent.

“Huawei’s performance in China helped it avoid a worse quarterly performance,” added Gupta. “Huawei extended its lead in China where it captured 42.6 per cent of China’s smartphone market in the second quarter of 2020. Huawei put in place an aggressive product introduction and sales promotion in China in particular and benefited from the strong support of communications services providers for its 5G smartphones.”

Apple suffered the least out of the top handset makers, only sliding 0.4 per cent to 38m compared to Q2 2019. The fourth and fifth biggest vendors, Xiaomi and Oppo, suffered declines of 21.5 per cent and 15.9 per cent respectively.

“Apple’s iPhone sales fared better in the quarter than most smartphone vendors in the market and also grew sales quarter-over-quarter,” said Annette Zimmermann, Research Vice President at Gartner. “The improved business environment in China helped Apple achieve growth in the country. In addition, the introduction of the new iPhone SE encouraged users of older phones upgrade their smartphones.”

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Chinese smartphone makers – mostly Oppo, Vivo, Xiaomi, Realme, and Huawei – were responsible for 19m of the 30.7m units shipped during the quarter, meaning there was a 50 per cent year-over-year (YoY) growth for the Chinese brands. The 30.7m overall shipments represented a modest growth of two per cent over the same quarter last year, following several quarters of decline.

“Southeast Asia is popular for new brands, as the chances of success are higher than in other parts of the world,” said Canalys analyst Matthew Xie.

South Korean brand Samsung sold 7.7m units to claim the individual top spot, up five per cent YoY after three quarters of decline. Oppo was a close second with 7.3m units sold – its best-ever quarter performance and a growth of 49 per cent. Vivo remained third, shipping 4.1m handsets, while Xiaomi moved up into fourth place with its 3.7m units sold. Realme entered the top five for the first time, shipping 1.6m smartphones, despite only being in Southeast Asia for three quarters. This meant that Huawei fell out of the top five as its various international struggles continue.

“Samsung is fighting back in Southeast Asia, where its leadership position has been challenged by Oppo, Vivo and Xiaomi,” said Xie. “Samsung chose Thailand to host the global launch event for its latest A series, to show the strategic importance of Southeast Asia.”

Research analyst Shengtao Jin added: “Oppo is moving aggressively to overtake Samsung as the leader in Southeast Asia. Spinning off the Realme operation last year has allowed the brand to expand aggressively in many markets… Together, Oppo and Realme have already exceeded Samsung’s shipments in this region. But, given Oppo’s top-selling devices remain its A5s and A3s, it is still facing challenges when trying to position itself as a high-end alternative to Samsung. The launch of the Reno series in June, plus its significant marketing spend, will be vital for Oppo’s attempt to break into the premium market, but it is still too early to see results.”

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Facebook just dealt a dangerous blow to Huawei amidst the technology company’s ongoing legal battle with the US government. According to Reuters, Facebook will now no longer allow any three of its apps – Facebook, Instagram, and WhatsApp- to be pre-installed on any future Huawei devices.

The ban will only effect devices that have yet to leave the Huawei factory, and users who already have Huawei phones will still be able to access and update the three social apps. Other popular apps, like Twitter and Booking.com also come pre-installed on Huawei phones, but neither company has made a comment about following in Facebook’s footsteps.

Last month, the US government banned any American companies from supplying technology to Huawei, including Google, which provides Android software to the Chinese tech giant. Google was granted a 90-day reprieve to continue working with Huawei, which ends in August.

For now, Huawei phone owners will be able to download the Facebook apps from the Google Playstore on their devices, but when the reprieve expires, the Playstore will no longer be accessible. As a result, future Huawei phones will lose access to any and all apps on the Google Playstore, including Facebook, Instagram, and WhatsApp, unless the US government changes its stance.

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Wrist-worn wearables continue to dominate the market, accounting for a 63.2 per cent share. However, ear-worn devices experienced the fastest growth (135.1 per cent) and accounted for 34.6 per cent of all wearables shipped – much of this can be attributed to Apple’s AirPods.

“The elimination of headphone jacks and the increased usage of smart assistants both inside and outside the home have been driving factors in the growth of ear-worn wearables,” said Jitesh Ubrani, research manager for IDC mobile device trackers. “Looking ahead, this will become an increasingly important category as major platform and device makers use ear-worn devices as an on-ramp to entice consumers into an ecosystem of wearable devices that complement the smartphone but also offer the ability to leave the phone behind when necessary.”

Apple is still dominant the force in the wearable market, thanks to its Apple Watch, AirPods, and select Beats headphones. The company shipped 12.8m units in Q1 2019, representing a 25.8 per cent market share and year-over-year (YoY) growth of 49.5 per cent. Despite the growth, it actually suffered a one per cent decline in market share.

Xiaomi picked up the second spot in the list, thanks to the popularity of its Mi Band, which accounted for around 5m of its 6.6m wearable sales. This gave it a 13.3 per cent market share, gaining Apple’s lost one per cent, and growth of 68.2 per cent.

Third spot was taken by Xiaomi’s Chinese counterpart, Huawei. The company, which is facing a host of international problems over security concerns, recorded a massive 282.2 per cent growth in sales, jumping from 1.3m in Q1 2018 to 5m in Q1 2019. Its market share also leaped from 4.1 per cent to 10 per cent.

Samsung picked up fourth spot with 4.3m sales, jumping 151.6 per cent, while Fitbit shipped 2.9m units.

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In the US and China, where the most smartphones are sold, sales fell by 15.8 per cent and 3.2 per cent respectively. These struggles can be attributed to the rising price and slowing innovation of devices leading people to feel less of a need to regularly upgrade their handset.

“Demand for premium smartphones remained lower than for basic smartphones, which affected brands such as Samsung and Apple that have significant stakes in high-end smartphones,” said Anshul Gupta, senior research director at Gartner. “In addition, demand for utility smartphones declined as the rate of upgrading from feature phones to smartphones has slowed, given that 4G feature phones give users great advantages at a lower cost.”

Samsung held on to the top spot in worldwide smartphone sales, achieving a 19.2 per cent share of the market with its 71.6m sales, according to Gartner. This marked a decline of around 7m sales and a 1.3 per cent fall in market share over the same quarter in 2018.

On the other hand, Huawei achieved a 44.5 per cent growth, reaching 58.4m units sold. This handed Huawei a 15.7 per cent market share, up from the 10.5 per cent in Q1 2018.

“Huawei did particularly well in two of its biggest regions, Europe and Greater China, where its smartphone sales grew by 69 per cent and 33 per cent, respectively,” said Gupta. “Unavailability of Google apps and services on Huawei smartphones, if implemented, will upset Huawei’s international smartphone business which is almost half of its worldwide phone business. Not the least it brings apprehension among buyers, limiting Huawei’s growth in the near term.”

Apple’s year-over-year sales dropped by nearly 10m, falling to 44.5m and giving the company an 11.9 per cent market share.

Oppo and Vivo rounded off the top five with their 7.9 and 7.3 per cent respective market shares.

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Current Huawei handset owners will be able to continue using and download app updates, according to Reuters, which first reported the news. Meanwhile, Huawei will still be able to access elements of Android through what is publicly available via open source licensing.

Huawei has ambitions to continue expanding its business outside of China. And, though it has many roadblocks from international governments, it has managed to leapfrog Apple in terms of smartphone sales. Google’s decision throws a spanner in the works of this progress as future versions of Huawei’s Android smartphones will no longer have access to apps such as Google Play, Gmail, and YouTube.

Last week, the US government added Huawei to a trade blacklist, putting restrictions in place that make it difficult for it to engage in business with US companies. However, the US Commerce Department followed this up by saying it was considering removing some of these restrictions, so that current services are not affected.

On the back of Huawei’s blacklisting, chipmakers – including Intel, Qualcomm, Xilinx, and Broadcom – told employees they would not be supplying Huawei with key software and components until further notice.

Huawei has long been aware of the possibility that Google may decided to bar it from using Android and, as such, has been developing its own technology – which is already in use in some products in China, where most Google apps are blocked anyway.
In a statement, Huawei said:
“Huawei has made substantial contributions to the development and growth of Android around the world. As one of Android’s key global partners, we have worked closely with their open-source platform to develop an ecosystem that has benefitted both users and the industry. Huawei will continue to provide security updates and after sales services to all existing Huawei and Honor smartphone and tablet products covering those have been sold or still in stock globally. We will continue to build a safe and sustainable software ecosystem, in order to provide the best experience for all users globally.”

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According to Counterpoint Research, only Chinese brands Huawei, Oppo, and Vivo were able to achieve growth in Q1 2019, with the global smartphone market declining for the sixth consecutive quarter. Within this, Apple’s iPhone shipments fell YoY for the second consecutive quarter, dropping 20 per cent as its market share dipped from 14 per cent to 12 per cent.

“The global smartphone market showed no sign of recovery in Q1 2019. The rate of decline came down, particularly in February, due to inventory correction by some brands and the production halt during Chinese New Year,” said Tarun Pathak, associate director at Counterpoint. “Another reason for the decline is lengthening replacement cycles, especially in the premium segment. The replacement rate for iPhones is reaching close to 36 months, while the replacement rate for premium Android devices is closing in at 30 months. This can be attributed to the higher quality of devices, increasing average selling price (ASP), and the lack of innovative technology.”

Samsung maintained its number one position, but saw shipments fall by eight per cent and its market share take a slight hit in falling from 22 per cent to 21 per cent. Huawei’s growth saw its market share leap from 11 per cent to 17 per cent.

“Huawei became the second largest smartphone brand by shipment without a significant presence in an important market like the US,” said Shobhit Srivastava, research analyst at Counterpoint. “It was also the fastest growing brand among the top 10. At this pace, we expect Huawei to remain ahead of Apple at the end of 2019.”

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