China’s Xiaomi overtakes Apple to grab second spot in global smartphone industry

China's Xiaomi has overtaken iPhone maker Apple to become the world's second-biggest smartphone manufacturer, according to a new report.

The company, which is based in Beijing, sold more than 51 million smartphones in the second quarter, more than 22.7 million more phones than a year earlier, US research company Gartner said.

Its market share surged to 15.5 per cent in the three months to June 30, up from 9.5 per cent in the same period last year.

“Xiaomi registered 80.5 per cent growth in its smartphone sales owing to a stronger online presence and fast expansion in the global markets beyond Asia-Pacific, led by investments in retail channels and partnerships with communication service providers,” Gartner said.

Driven by strong smartphone sales, Xiaomi’s net profit climbed to nearly 8.3 billion Chinese yuan ($1.3bn) in the April-June period. Revenue during the period rose 64 per cent to 87.8bn yuan, beating analysts' estimates of 85bn yuan.

Overall, global smartphone shipments to end users stood at 328.8 million in the second quarter, an increase of 10.8 per cent year-on-year, despite supply constraints because of Covid-induced production disruptions and component shortages.

“Demand for smartphones continued to be strong in this quarter as buyers preferred higher specifications and better user experience. The pent-up demand from 2020 continues to drive advantage for global smartphone vendors in 2021,” said Anshul Gupta, senior research director at Gartner.

“Regions with higher penetration of 5G connectivity saw strong demand for 5G smartphones and were growth drivers for leading smartphone vendors.”

South Korean smartphone manufacturer Samsung maintained its top position with 17.6 per cent market share in the second quarter. It sold 57.7 million smartphones in the three-month period, an annual increase of 5.4 per cent.

Apple, which is expected to launch new iPhones this month, sold more than 49.2 million devices to grab a 15 per cent market share.

Other Chinese smartphone vendors Oppo and Vivo grew 42.4 per cent and 41.6 per cent annually, respectively, in the second quarter.

Aggressively priced mid-tier smartphones, a wider distribution network and robust marketing campaigns in Europe boosted the growth of Oppo, said Gartner. Vivo is continuing to expand its market presence beyond the Asia-Pacific region, beginning with a focus on Europe, the Middle East and Africa.