Huawei Smartphone Shipments Rise

By Dow Jones Business News, 
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China's Huawei Technologies Co. said its smartphone shipments rose 62% in the first half of this year, helped by strong demand in overseas markets such as Latin America and the Middle East for new handsets that work on faster-speed networks.

The first-half results make Huawei one of the fastest-growing players in the global smartphone market. Earlier this month, market leader Samsung Electronics Co. said it expected a decline in operating profit in the second quarter due to sluggish smartphone sales.

Huawei shipped 34.27 million smartphones world-wide in the six months through June, the company said Tuesday. Growth accelerated in the second quarter, when it shipped 20.56 million smartphones, the company said.

While China's smartphone market--the largest for Huawei's handset business--is showing signs of slower growth, Huawei is expanding rapidly in emerging markets abroad. The company said its smartphone shipments in the Middle East and Africa increased more than sixfold from a year earlier, while shipments in Latin America rose nearly fourfold. In Europe and the Asian-Pacific region, excluding China, shipments more than doubled, it said.

To make its name more recognized by consumers abroad, Huawei has been spending more on international marketing, mainly through sponsorship deals with professional soccer teams in Europe, such as the U.K.'sArsenal Football Club and Italy's AC Milan.

Huawei said it is also trying to sell more mid- to high-end smartphones, rather than selling the cheapest phones on the market. In May, Huawei launched its new flagship smartphone, the Ascend P7, which comes with a 5-inch screen and a camera feature designed specifically for taking group self-portraits. On Tuesday, Huawei said it has sold nearly two million units of the Ascend P7 so far.

Shenzhen-based Huawei, whose main business is selling telecommunications equipment to carriers, is trying to sell more handsets to challenge the dominance of Samsung and Apple Inc. Even though Huawei was the world's third-largest smartphone vendor in the first quarter, according to research firm IDC, its market share of 5% was still far behind those of Samsung and Apple. In China, the world's largest smartphone market, Huawei faces tough competition not only from Samsung and Apple but from other Chinese handset vendors such as Lenovo Group Ltd. and Xiaomi Inc.

Earlier this month, Richard Yu, the head of Huawei's consumer business group, said in an internal memo that revenue for his group, which mainly sells smartphones, rose 30% in the first half of this year. In the memo, viewed by The Wall Street Journal, Mr. Yu also said that his group by midyear had already achieved more than half of its 2014 profit target. Huawei has said previously that its smartphone business is profitable, but it hasn't disclosed specific figures.

Write to Juro Osawa at juro.osawa@wsj.com

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