Huawei’s smartphone sales are still soaring, but only in China. That’s a big blow for a company that just a few months ago was in pole position to overtake Samsung as the biggest smartphone seller in the world.
Those hopes were dashed when Washington placed Huawei on a trade blacklist in May. The ban bars US companies from selling tech and components to Huawei, the world’s largest telecommunications equipment maker and No. 2 smartphone seller.
Data from market research firms Canalys and IDC underscore how the company’s smartphone unit has been forced to focus on domestic sales, just as China’s economy is slowing and consumers are tightening their belts.
“Huawei is not hanging all of its growth prospects on China yet, but it has been backed into a corner in the past couple of quarters,” said Ben Stanton, an analyst with Canalys.
Huawei shipped 67 million smartphones in the third quarter, up nearly 30% compared to a year earlier, according to the data from Canalys and IDC. The surge was driven by a spike in sales in China, where the company grew shipments by more than 60%, despite the overall market shrinking compared with the previous year.
But Huawei’s smartphone sales outside of China fell 6% year-on-year last quarter, and that followed a plunge of between 12% and 17% in overseas shipments in the second quarter, data from IDC and Canalys showed. The two market research firms are independent, and use slightly different metrics to measure smartphone shipments.
The US ban has hit Huawei’s global sales particularly hard because new devices no longer have access to some critical Google (GOOGL) mobile services.
Huawei released its latest flagship phone, the Mate 30, in late September. The device, which is priced at €799 ($880) and upward, doesn’t have access to either the Google Play store or the many popular apps within it, such as Google maps, Uber (UBER) or Facebook (FB).
That’s less of a problem for Huawei in China, where some of the global apps have been banned for many years or there are homegrown alternatives.
But overseas, many carriers and retailers have “become more reluctant to stock Huawei products as [they] aren’t sure how Huawei is going to manage around the lack of Google services,” IDC analyst Melissa Chau said.