Huawei reports slowest revenue growth in 4 years

pulse

January 2, 2018 4:13 PM

Chinese smartphone vendor Huawei is expecting revenue growth of 15% for 2017, a notable deceleration from 32% revenue growth in 2016.

This story was delivered to BI Intelligence subscribers hours before appearing on Business Insider. To be the first to know, please .

according

Huawei has undertaken two major smartphone strategy shifts in 2017 that are impacting its growth. First, the company announced in July 2017 that it would give up on low-end smartphones, opting instead to focus only on mid-range and premium devices. Second, Huawei is focusing on growing in developed foreign markets due to competition from other Chinese vendors both at home and abroad. Here's why Huawei's looking to high-end device sales outside of China:

. As adoption in China grows, shipment growth will be limited to users upgrading their handsets, rather than from new purchases of smartphones.
Competing Chinese smartphone vendors are growing their presence in emerging markets, most notably with low-end devices.
IDC
both heavily invested

One key market Huawei is eyeing for expansion is the US. Huawei is reportedly in talks with US carriers Verizon and AT&T about selling its smartphones to US consumers in 2018. Huawei already sells its budget devices in the US via Amazon, Walmart and other retailers, but working directly with US carriers could help guarantee success in the market because selling devices via telecoms, which are the dominant distribution channels in the nation, could strengthen its presence in the US.

And the newfound ability to further tap into the world’s third-largest smartphone market will help the Huawei expand its global smartphone shares further, which can in turn, boost smartphone revenue. This method has worked for Huawei's expansion efforts in other developed markets, where partnering with telecoms has helped the company challenge Apple and Samsung in mid-range and premium devices.

To receive stories like this one directly to your inbox every morning, sign up for the Apps and Platforms newsletter. Click here to learn more about how you can gain risk-free access today.

pulse

JOIN OUR PULSE COMMUNITY!

Unblock notifications in browser settings.

Eyewitness? Submit your stories now via social or:

Email: eyewitness@pulse.ng