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Sanctions Reality Bites Huawei with Plunging Smartphone Sales

By Yang Ge / Jan 29, 2021 10:46 AM / Business & Tech

Photo: VCG

Photo: VCG

The bad news keeps coming for sanction-hobbled Huawei.

IDC has just released its latest quarterly smartphone results, which show the embattled telecom giant’s smartphone sales plunged by nearly half — or 42.4% to be exact — in last year’s fourth quarter from a year earlier. That made Huawei the world’s fifth biggest brand for the period, a far cry from just two quarters earlier when it was at the top of the heap.

Huawei has been dogged by U.S. sanctions for nearly two years now, as Washington aims to limit the company’s role in the worldwide development of state-of-the-art 5G smartphones and networking equipment. First the U.S. banned American companies from selling components and software to Huawei. And last year it turned up the pressure by leaning on some of Huawei’s key non-American suppliers to abandon the company as well.

That’s left Huawei with a limited supply of chips and other key components that have hurt its ability to make smartphones, forcing it to rely on stockpiles built up before the sanctions took effect.

Meantime, Huawei’s pain has been Apple and Xiaomi’s gain. The iPhone maker’s smartphone shipments surged 22.2% year-on-year in the quarter, enough to lift it past Samsung for the smartphone crown, as it shipped 90.1 million iPhones — a record for a single vendor in a single quarter. And Xiaomi’s shipments rose by an even stronger 32%, giving it 11.2% of the global smartphone market.

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