Huawei reportedly overtakes Qualcomm as China’s top semiconductor player

[ad_1]

Richard Yu (Yu Chengdong), head of Huawei’s consumer business, speaks during the presentation of a Kirin 990 5G chip set at the international electronics and innovation fair IFA in Berlin on September 6, 2019.

Tobias Schwarz | AFP | Getty Images

Huawei’s semiconductor design unit overtook Qualcomm as China’s number one chip supplier for the first time as the coronavirus impact on the country’s smartphone market hit the U.S. giant.

The unit, known as HiSilicon, shipped 22.21 million smartphone processors in the first quarter of 2020, roughly in line with the number shipped in the same period last year, according to a new report by China-based CINNO Research. Huawei’s HiSilicon managed to increase its market share to 43.9%, from 24.3% in the first quarter of 2019. 

CINNO Research, which tracks the country’s semiconductor market, did not disclose shipment figures for Qualcomm or other vendors, but said the U.S. firm’s market share fell to 32.8% in the March quarter, from 48.1% in the same period last year. 

HiSilicon designs chips under the Kirin brand which go into Huawei’s smartphones. The semiconductors are manufactured by Taiwan Semiconductor Manufacturing Company (TSMC). 

The growth of HiSilicon in China mirrors the fact that Huawei has been increasingly focused on its domestic market since it was put on a U.S. blacklist last year known as the Entity List. That restricted its access to American technology including Google’s Android operating system. While that isn’t a big deal in China, where Google services such as Gmail are banned, it has had a big impact on its international consumers who rely on using those apps.  

As it began to double down on China, Huawei’s share of the smartphone market grew. In the first quarter of 2020, its smartphone shipments were up 6% from last year, according to a report from Counterpoint Research published Wednesday. Huawei has also been trying to reduce its reliance on U.S. components with its smartphone chips a key part of that push.

The company’s growth in China has increased its share of the smartphone processor market. But Huawei’s growth has also come at the expense of the company’s domestic rivals, which are some of Qualcomm’s key customers. 

In August, Qualcomm CEO Steve Mollenkopf said Huawei’s focus on the China market was hurting the U.S. company. 

“As a result of the export ban, Huawei shifted their emphasis to building market share in the domestic China market, where we do not see the corresponding benefits in product or licensing revenue,” he told investors on an earnings call. 

That’s because Qualcomm sells chips to Huawei’s domestic rivals like Xiaomi and Oppo. Both those companies saw their shipments decline in 2019, according to research firm Canalys. 

The overall smartphone market was weakened further after the coronavirus outbreak shut down of most of the country for several weeks in the first quarter. In China, mobile phone shipments fell 23.3% in March after a 56% plunge in February, official government data showed. 

Meanwhile, first-quarter shipments of Apple iPhones likely dropped just 1% from last year, Counterpoint Research said. 

That is in line with CINNO Research’s semiconductor report that shows Apple’s market share for chips remained basically flat. Apple designs its own chips for its smartphones. 

[ad_2]

Source link