Xiaomi Dethrones Apple, Becomes the Second-largest Smartphone Maker

Xiaomi Dethrones Apple, Becomes the Second-largest Smartphone Maker

Chinese smartphone maker Xiaomi was the second-largest smartphone maker in the second quarter, overtaking Apple, according to a report from analyst firm Canalys.

Samsung was the leading vendor with a 19% share of smartphones shipped. Apple was third with 14%, while Vivo and Oppo took the fourth and fifth positions respectively.

Xiaomi had a 17% share of global smartphone shipments, ahead of Apple’s 14% and behind Samsung’s 19%. Oppo and Vivo share 10%.

“Xiaomi is growing its overseas business rapidly,” Canalys Research Manager Ben Stanton said in a press release, noting shipments increased 300% year-on-year in Latin America and 50% in Western Europe.

The Chinese smartphone maker posted year-on-year smartphone shipment growth of 83% versus 15% for Samsung and 1% for Apple.

Stanton noted, however, that Xiaomi phones are still skewed toward the mass market with the average selling price of its handsets 75% cheaper than Apple’s.

But the Beijing-headquartered company is now looking to push into the high-end market. Earlier this year it launched the Mi 11 Ultra, a premium smartphone that starts at 5,999 yuan ($928). It also launched the 9,999 yuan Mi Mix Fold, its first foldable phone.

That price range pits Xiaomi against Apple and Samsung in the premium segment. But its domestic rivals Oppo and Vivo are also trying to break through into the high-end market.

“It will be a tough battle, with Oppo and Vivo sharing the same objective, and both willing to spend big on above-the-line marketing to build their brands in a way that Xiaomi is not,” Stanton said.

“All vendors are fighting hard to secure component supply amid global shortages, but Xiaomi already has its sights set on the next prize: displacing Samsung to become the world’s largest vendor.”

Xiaomi has benefitted from Huawei’s struggles. Huawei was once the largest smartphone player in the world, but U.S. sanctions cut the Chinese company off from critical supplies including software and chips, causing its sales to plunge.

While smartphones still account for the majority of Xiaomi’s revenue, it is looking to get into new business areas. In March, the technology firm announced plans to launch an electric vehicle business and invest $10 billion over the next 10 years.

Apple being pushed behind Samsung and now Xiaomi signals potential regression to fourth position for the American company.

Global chip shortage has seriously impacted the tech industry, cutting production capacity of many companies including smartphone makers. Stanton noted that “all vendors are fighting hard to secure component supply amid global shortages.”

While Apple is now developing its own chips, which seemingly gives it an advantage over its competitors, Xiaomi is increasingly winning more market shares with cheaper devices and aims to dethrone Samsung soon.

“Xiaomi already has its sights set on the next price: displacing Samsung to become the world’s largest vendor,” Stanton said.

Xiaomi’s growth is also attributed to the quick recovery of China’s economy from the shocks of COVID-19 pandemic. With almost every of China’s economic sectors fully open, the smartphone maker has a huge buoyant market to cash in on.

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