Huawei Closing in Fast on Apple in Smartphone Sales According to Latest Estimate

[kdarling]

Remember there was a time when OnePlus, HTC, and some other Chinese manufacturers to be the iPhone killer. What happened? They all faded.

Re: HTC. I think it's ironic that they were going great, right up until they signed a cross-license with Apple to avoid lawsuits.

For one thing, that gave Apple access to HTC's patented all metal back antenna technology used in the HTC One -- a design which soon showed up in the iPhone 6.

Plus being safe from Apple lawsuits, and being able to use some iPhone patents, made them seem more run of the mill versus a rebel.

 

[69Mustang]

Not even close unfortunately.

If you define India's "middle class" as one step above poverty, then yes, India has a high middle class population.

If you want to look at buying power, consider in 2016, the Indian population purchased 3 million cars. In the same year, Chinese purchased 28 million cars and Americans around 18 million.

There's a reason why Tim Cook and Luca Maestri used the word "China" nearly 20 times in their earnings call yesterday and said "India" only twice.

Pew Research Center: Poverty Retreats in India, but the Middle Class Barely Expands

Even if you cut that 10% in half and say 50 million middle class or half that and say 25 million of that middle class can afford an iPhone that's still larger than the middle class in the vast majority of the rest of the world. Not really sure of the relevance of your China reference. No one is comparing the viability of India vs China. We were discussing the dismissal of the Indian middle class in favor of focusing on the poor. Not intending to sound callous, but Apple as a business isn't concerned with how many poor are in India. They're concerned with how many potential customers are in India and even the most conservative estimates has that number being, scientifically speaking, a helluva lot.

FYI, you linked data is really dated.

 

[ani4ani]

Every time I hold one of the Android phones in my hand a thought pops up in my mind immediately: cheap Chinese junk heap. Sure, the higher end phones are a little bit nice but a lot of them try to imitate iPhone because they know who's the king. So until Chinese companies make a quality product at the right price, I'll stick with iPhone. But I don't think they will because they just know how to make cheap Chinese junk and nothing else.

You do know the iPhone is made entirely in China?

 

[iSRS]

Design of various Android phones is nicer. But Apple rules with iOS, much higher quality, and by far the best service.

Apple has the edge on brand recognition but Huawei has better design, quality and value that's why the local Chinese phones are outselling the foreign Chinese phones like iPhones.

I admit I haven't looked at any of their other phones, but the one in this article looks EXACTLY like an iPhone 6/6s/7. So yeah, they have SUCH BETTER design than Apple....

 

[MacBH928]

competition is good. Because of competition we got BlackBerry which was outdone by the iPhone of which Apple stepped up their game when Samsung started to compete against them with Android.

Now we need competition on the software side of things. iOS works, and works very well but its time to move on with the new OS that is really going to take us to the post PC era because this 2007 relic is not going to cut it for the future.

 

[5105973]

Perhaps Apple services are being sabotaged in china?

Interesting thought. I don't know enough about their operations there to properly consider that suggestion. We need more forum members based in China to comment on how their services work and fail to work there.
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Because manufacturers like OnePlus and HTC don't have the resources like Huawei to compete with the juggernauts like Apple and Samsung.

HTC is based in Taiwan, fwiw.

 

[JPack]

Even if you cut that 10% in half and say 50 million middle class or half that and say 25 million of that middle class can afford an iPhone that's still larger than the middle class in the vast majority of the rest of the world. Not really sure of the relevance of your China reference. No one is comparing the viability of India vs China. We were discussing the dismissal of the Indian middle class in favor of focusing on the poor. Not intending to sound callous, but Apple as a business isn't concerned with how many poor are in India. They're concerned with how many potential customers are in India and even the most conservative estimates has that number being, scientifically speaking, a helluva lot.

FYI, you linked data is really dated.

You're completely missing the point again by throwing out random numbers.

What's the definition of "middle class" in India? In India, the threshold for "middle class" is $13,000 which is one of the lowest in the world. In the U.S. and China, that number is close to $50,000. Do you think a typical "middle class" Indian will spend 10% of their annual income to pick up an iPhone 7 Plus when they don't even own a car or motorcycle?

• India accounts for 3% of the global middle class with 23.6 million people.
• It has the lowest threshold for a person to be considered middle class with annual wealth of $13,662.

Indian middle class is 24 million, not 264 million: Credit Suisse

 

[swm]

lemme think how many iphones apple has to offer
7 7p 6s 6sp se
thats like 5, right?
more or less w consistent features and experience

now huawei has at least 30
see for yourself here
http://consumer.huawei.com/en/phones/ and keep hitting load more at the bottom. most of them is dirt cheap crap with negligible margin. the issue is that anyone hears “huawei” owerseas, thinks of their flagship p10. and we did not see their product range for their local market.
so sold or shipped item numers tell no story

 

[Abazigal]

Do you care to back this statement ?
Best in what?
Screen?No,
Processor?No
Memory?No
Battery?No
And this is just the hardware,the iPhone is overpriced and anyone that doesn't see that is blind or worst, we have the top voted post actually boasting that apple has the biggest profits even though the sales are not like this money go into your pockets,No this means apple sales that costs 200$ at 1000$ + while the others sale into more reasonable prices(and to those that will say there is more than the price of HD in the game I will respond so does for the others).

It doesn't matter how cheap the competition is. 3 HUAWEI phones still won't let me do what I do on my iPhone.

That's what I am paying for - Apple's expertise in putting all these parts together in a manner to create that unique user experience which only Apple can provide.

 

[69Mustang]

You're completely missing the point again by throwing out random numbers.

What's the definition of "middle class" in India? In India, the threshold for "middle class" is $13,000 which is one of the lowest in the world. In the U.S. and China, that number is close to $50,000. Do you think a typical "middle class" Indian will spend 10% of their annual income to pick up an iPhone 7 Plus when they don't even own a car or motorcycle?

• India accounts for 3% of the global middle class with 23.6 million people.
• It has the lowest threshold for a person to be considered middle class with annual wealth of $13,662.

Indian middle class is 24 million, not 264 million: Credit Suisse

I disagree. It is you who are missing the point. Since I was the one who made the initial point, I can't really miss it, now can I? You are arguing a different point altogether. You are arguing the sample numbers I used instead of the point I was making. That point, if it hasn't been clear, is there is a boatload of people in India who can afford an iPhone. The fact that Apple is building iPhones in India is testimony that Apple believes the same thing.

The conclusions you reach from your data analysis is flawed. As flawed as the logic used by Credit Suisse in that link (which I had read previously and ignored their consensus because of their methodology of wealth vs income). In that same link, CNN-IBN used a consumption based criteria similar to your car ownership criteria and came up with 200 million middle class. Then there's your assumption about what a person would spend their money on in India. It relies on the belief that a fiscally responsible person wouldn't spend 10% of their income on a phone. There's no data to support that belief. Anecdotally, people the world over have been known to spend beyond their means. Heck, look at all the McDonald's employees sporting iPhones. Why would Indians be any different?

You're bulleted points depend on CS's interpretation of middle class being correct. Wealth of the middle class being determined by the presumption that wealth is determined by resistance to temporary setbacks? That is such a narrow and arbitrary qualification that it's almost useless.

Let's agree to disagree. You seem to be satisfied with your take, and I'm satisfied with mine. Neither of us seems to be presenting an argument compelling enough to sway the other. It's been fun. No snark. I enjoy the engagement.

 

[JPack]

That point, if it hasn't been clear, is there is a boatload of people in India who can afford an iPhone. The fact that Apple is building iPhones in India is testimony that Apple believes the same thing.

Then there's your assumption about what a person would spend their money on in India. It relies on the belief that a fiscally responsible person wouldn't spend 10% of their income on a phone. There's no data to support that belief. Anecdotally, people the world over have been known to spend beyond their means. Heck, look at all the McDonald's employees sporting iPhones. Why would Indians be any different?

Let's agree to disagree. You seem to be satisfied with your take, and I'm satisfied with mine. Neither of us seems to be presenting an argument compelling enough to sway the other. It's been fun. No snark. I enjoy the engagement.

I'll only refute a couple points:

1. What iPhone is Apple assembling in India? Why only the iPhone SE and why did Apple price the SE cheaper in India than anywhere else in the world? Apple in no hurry to make more models in India.

2. One of the metrics economists look at is the gross national savings rate for each country. The United States has one of the lowest savings rate in the world at about 10%. India is at about 30%. Are Indians as reckless with spending as Americans? Probably not. Instead of relying on anecdotes, there's plenty of OECD data out there to show household debt as a % disposable income for India is one of the lowest in the world, partly because there are few credit institutions in India to even support that lifestyle.

 

[ahireasu]

Well not really:
- battery efficiency yes
- custom soc yes
- screens yes (well I dislike the current gen of oled screens)
- overpriced subjective

By whose yardstick, I buy what's best for me and to me that is the best.
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Ahh, android fans brag about market share for sure.

I am sorry but the battery on iPhones doesn't last that long that's a fact, the soc is really good yes especially in single core but again we are talking about the most expensive phone so it gets a No there as well, as for the screen iPhone hasn't had the best screen since iPhone 5-5s were it got 98% ?in RGB back then, since then the oled screens have improved allot and dominate,
as for price to be subjective hmm when you sell the most expensive phone no it isn't.

The guy I quoted and since hasn't give an answer to his post said "apple has the best phone blah blah" and to that I responded.
I will not tell to anyone what to buy, I don't care,we are all free to buy what is best for us based on our own taste etc. but to see someone celebrate or smirke and say "but apple makes the most money" , newsflash they make more money on HD on our backs by selling in the highest price of all its not something to be proud of and no I don't use android and never will.
PS.Where is the multitasking on the iPhones?

 

[koruki]

Have they considered that the ones that can afford an iPhone has bought one years ago, and the market size of smartphone users is still growing with users who couldn't afford high end models before but now able to with cheaper models? If the iPhone user numbers stay constant, it will still decrease in percentage. A rural area that now has started using smart phones will not be able to buy an iPhone, not because they don't desire one but because they can not afford one.

 

[hotspring21]

India is too poor, *99% of the population can't afford one.(*Just a guesstimate based on what I saw)



Plenty of cheap 'non branded crap for poor people.

ifanboys have their head permanently stuck in the sand. Inexpensive/free Android phones have come a long long way. My wife who used to use an iphone just got an Android phone for $10 from Cricket-wireless (LG Harmony). It's 5.3" phone, better than iphone in some ways (such as bigger display, smaller bezels, SD card slot, removable battery, headphone jack) and handles pretty much every day to day task no problem. Even the poorest people can get their hands on a very good Android phone, because that's what the low end has become - perfectly capable of meeting needs of vast majority of people on this planet. Soon Android will go past 90% market share and beyond. But Apple doesn't care that vast majority of people (even if it goes to 99%) in the world will use Android, because they only care about maximizing profit.

 

[zerotrace]

Market share is a vanity metric. Profit share is a much more telling metric for business success.

 

[Waughy]

In Australia I virtually know no one who uses Facetime or iMessage

I'll agree on Facetime, but everyone I know with an iPhone uses iMessage. I don't use Whatsapp, and don't know anyone that does. That's not to say it isn't popular here. I don't think it matters as much these days though compared to when Whatsapp first launched, as most plans now offer unlimited SMS anyway.

I do know one person that uses Facetime for viewing properties he's interested in investing in that are in other states. he finds it's very useful for that.

 

[zerotrace]

Businesses exist to maximize profit. Google is no different. If a business can't make competitive profits long term, they won't stay in business.

 

[macs4nw]

Apple: let's remove VPN apps so there will be even less incentives for consumers in China to buy iPhones.

I don't think Apple is in the process of removing VPN Apps voluntarily.

 

[mi7chy]

I admit I haven't looked at any of their other phones, but the one in this article looks EXACTLY like an iPhone 6/6s/7. So yeah, they have SUCH BETTER design than Apple....

iPhone 6 design is just a lesser copy of the HTC One released about 1.5 years prior in 2013.

Design and finish of the $400 range Huawei Honor 9 puts the iPhone 6/6+/7 to shame. Apple need to up their design game since it looks like something sold in a back alley.

 

[Michael Scrip]

When 60% of your business is derived directly by a phone and probably 80% of your business indirectly linked to a phone [i.e. apps, itunes, headphones etc all linked to owning that phone] and it is basically your sole product, you better worry about it when someone picks a competitor's product over yours.

But it's always been that more people have been choosing a competitor's product over Apple's product.

iPhone market share has never been very high... correct?

That means the majority of smartphone buyers were choosing non-iPhones. And they have for years.

However... since Apple only sells relatively expensive smartphones running their own OS... with an average selling price of over $600... Apple has carved out a niche for themselves.

Huawei may surpass Apple on the chart of smartphone OEMs. But Huawei sells phones running Android... while Apple sells phones running iOS. It's not exactly a 1:1 matchup.

This reminds me of the PC market. Is anyone bothered that Apple is #5 on the chart? Behind so many Windows PC vendors?

No... because Apple is the only company to sell Macs. They're doing their own thing.

Apple has 100% of the the Mac market... just like they have 100% of the iPhone market.

I see what you're saying... but the threat of "people choosing competitors' phones" is nothing new. And it applies to every manufacturer... not just Apple.

 

[MacBram]

Shipped and sold means the same thing in these reports.

Apple, like most everyone else (*), reports a sale when a unit is shipped to a retailer.

So when you read that Apple sold 40 million iPhones, it does not mean they were all sold to end users. Most were sold to retailers. And some quarters, millions of those go unsold until the next quarter.

(*) Samsung reports the sale AFTER the unit arrives at a retailer. By reporting earlier, at time of shipping, Apple can publicize bigger sales numbers during opening weekends while millions of units are still on the way to stores.

No. The confusion is not that Apple fans think Apple numbers are units SOLD to end users, while Samsung or others' numbers are units merely SHIPPED to retailers.

The fact is that you are right, "shipped = sold" ...only, it is pretty much literally correct in the case of Apple, and sold to retailer is practically assured to mean sold to end user within a couple of weeks. That's the point.

1) Apple's whole supply chain is tight and they know exactly how many and when units end up in the hands of end users. There are no containers or palettes of iPhones languishing somewhere until BOGOF deals get rid of a few more. No, no matter how big the retailer (big box, nationwide, Walmart, whatever), small numbers of iPhones are couriered to each and every outlet weekly. The whole chain is so tight, it's unbelievable.

That 3 million they just announced in the supply chain? That's worldwide, thousands upon thousands of sellers (big chains, big box retailers, small certified Apple resellers, Apple's own stores): https://www.lifewire.com/where-to-buy-iphone-1999719
On that page, in US alone, I am seeing, for starters: 2200 AT&T stores, 1700 Target stores, Walmart, Sam's Club, Verizon, T-Mobile, Sprint, Staples...
Apple has to have several million unsold in distribution network worldwide... that's like maybe 2 or 3 phones per location. But Apple is very clear about how many weeks inventory that is, they'll say 2 or 3 week's worth, and they know to a unit. And they pledge those numbers officially in earnings calls and statements; and they are more transparent in that regard than anyone else.

2) the ASP of Apple is steady (if anything, it goes up). So, that tells you something about sales. Apple could also get rid of inventory if it allowed retailers to deeply discount units or run BOGOF deals, but it doesn't. Why, because EVERY unit sells through to an end user within a couple of weeks.

 

[Michael Scrip]

The fact is that you are right, "shipped = sold" ...only, it is pretty much literally correct in the case of Apple, and sold to retailer is practically assured to mean sold to end user within a couple of weeks. That's the point.

1) Apple's whole supply chain is tight and they know exactly how many and when units end up in the hands of end users. There are no containers or palettes of iPhones languishing somewhere until BOGOF deals get rid of a few more. No, no matter how big the retailer (big box, nationwide, Walmart, whatever), small numbers of iPhones are like couriered to each and every outlet weekly. The whole chain is so tight, it's unbelievable.

Exactly... it's safe to assume that if an iPhone is sitting on a store shelf somewhere... it won't be there very long.

It will find an owner very soon.

 

[Carnegie]

No. The confusion is not that Apple fans think Apple numbers are units SOLD to end users, while Samsung or others' numbers are units merely shipped to retailers.

The fact is that you are right, "shipped = sold" ...only, it is pretty much literally correct in the case of Apple, and sold to retailer is practically assured to mean sold to end user within a couple of weeks. That's the point.

1) Apple's whole supply chain is tight and they know exactly how many and when units end up in the hands of end users. There are no containers or palettes of iPhones languishing somewhere until BOGOF deals get rid of a few more. No, no matter how big the retailer (big box, nationwide, Walmart, whatever), small numbers of iPhones are like couriered to each and every outlet weekly. The whole chain is so tight, it's unbelievable.

That 3 million they just announced in the supply chain? That's worldwide, thousands upon thousands of sellers (big chains, big box retailers, small certified Apple resellers, Apple's own stores): https://www.lifewire.com/where-to-buy-iphone-1999719
On that page, in US alone, I am seeing, for starters: 2200 AT&T stores, 1700 Target stores, Walmart, Sam's Club, Verizon, T-Mobile, Sprint, Staples...
Apple has to have several million unsold in distribution network worldwide... that's like maybe 2 or 3 phones per location. But Apple is very clear about how many weeks inventory that is, they'll say 2 or 3 week's worth, and they know to a unit. And they pledge those numbers officially in earnings calls and statements; and they are more transparent in that regard than anyone else.

2) the ASP of Apple is steady (if anything, it goes up). So, that tells you something about sales. Apple could also get rid of inventory if it allowed retailers to deeply discount units or run BOGOF deals, but it doesn't. Why, because EVERY unit sells within a couple of weeks.

I'd agree that, for a number of reasons, considering Apple's sell-in numbers is somewhat different than considering some other companies' sell-in numbers. Also, Apple is more transparent than many in that it reports channel inventory changes and thus, in effect, sell-through numbers.

That said, Apple didn't announce that there were 3 million units of iPhone channel inventory (I think that's what you're referring to when you say in the supply chain?). It reported that iPhone channel inventory was reduced by 3.3 million units during the quarter. There are, or were at the end of this past quarter, something like 16-1/2 million iPhones in the channel inventory. Apple's target for channel inventory is 5 to 7 weeks worth.

 

[I7guy]

I am sorry but the battery on iPhones doesn't last that long that's a fact, the soc is really good yes especially in single core but again we are talking about the most expensive phone so it gets a No there as well, as for the screen iPhone hasn't had the best screen since iPhone 5-5s were it got 98% ?in RGB back then, since then the oled screens have improved allot and dominate,
as for price to be subjective hmm when you sell the most expensive phone no it isn't.

The guy I quoted and since hasn't give an answer to his post said "apple has the best phone blah blah" and to that I responded.
I will not tell to anyone what to buy, I don't care,we are all free to buy what is best for us based on our own taste etc. but to see someone celebrate or smirke and say "but apple makes the most money" , newsflash they make more money on HD on our backs by selling in the highest price of all its not something to be proud of and no I don't use android and never will.
PS.Where is the multitasking on the iPhones?

Well I see what you are saying, but you listed a few items in your post to which I responded. Value is subjective and that is what it is. But I said battery efficiency and the 7+ is very good with that, active usage plus standby and the SOC in my opinion is the best. Benchmarks prove it out. Price is relevant to what I think is best and we could probably go back and forth till the cows come home.

But there are plenty of other threads for that.
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iPhone 6 design is just a lesser copy of the HTC One released about 1.5 years prior in 2013.



Design and finish of the $400 range Huawei Honor 9 puts the iPhone 6/6+/7 to shame. Apple need to up their design game since it looks like something sold in a back alley.

Apple seems to have done quite well for selling product that looks like it was sold in a back alley. Maybe that's what apple customers want and apple gives the customer what they want, or else they would go elsewhere.

 

[kdarling]

I'd agree that, for a number of reasons, considering Apple's sell-in numbers is somewhat different than considering some other companies' sell-in numbers. Also, Apple is more transparent than many in that it reports channel inventory changes and thus, in effect, sell-through numbers.

What the channel changes also helpfully tell us, is when retailers have ordered too many for current demand. Or been nudged into doing

Quite often when Jobs or Cook needed a numbers boost, suddenly that quarter had unexpectedly good sales. But then the next quarter would usually have a large increase in channel inventory, because the stores overbought. Didn't matter, because by then the necessary great sale headlines were past.

The key point as far as stores go, is that they will not continue buying something that won't sell. Which is as true for other phones as it is for iPhones. That's why it's silly for people to claim that stores keep buying tens of millions of say, Samsung phones, just to put them on a warehouse shelf without sales.

That said, Apple didn't announce that there were 3 million units of iPhone channel inventory (I think that's what you're referring to when you say in the supply chain?). It reported that iPhone channel inventory was reduced by 3.3 million units during the quarter. There are, or were at the end of this past quarter, something like 16-1/2 million iPhones in the channel inventory. Apple's target for channel inventory is 5 to 7 weeks worth.

I lost track a few years ago, but yeah it was headed to by way past 16 million by now.