Huawei is betting its smartphone recovery on domestically produced chips and its proprietary HarmonyOS operating system, a strategic pivot born from necessity after U.S. sanctions crippled its international business in 2019.
The company launched the Mate 90 series smartphone on Oct. 1, featuring its own LogicFolding chip. Huawei Executive Director Richard Yu, who heads the consumer business, told foreign press the company aims to rebuild its overseas presence after losing access to Google's Android OS and Taiwan Semiconductor Manufacturing Company chips.
The scale of the collapse is stark: before 2019, Huawei shipped over 240 million smartphones globally and targeted 300 million units that year. Today it sells only several million smartphones outside China annually, Yu said. The consumer business revenue halved to approximately $34 billion in 2021, though it has since recovered to around $51 billion by 2025—still representing only 39 percent of Huawei's total revenue.
Huawei plans to expand HarmonyOS to overseas markets within one to three years, banking on China's domestic chip manufacturing capacity to support international sales. Whether Chinese-made semiconductors can match the performance and power efficiency of competitors like Qualcomm and MediaTek will determine whether the Mate 90 can gain meaningful traction in price-sensitive emerging markets, where most of Huawei's lost volume concentrated.
The smartphone strategy faces near-term headwinds. Counterpoint Research data shows double-digit year-over-year smartphone sales declines in China during August and September. Huawei-branded devices compete against entrenched rivals like Apple and Samsung in developed markets, and increasingly aggressive domestic competitors like Xiaomi and OnePlus in emerging ones.
Huawei's electric vehicle unit offers a cautionary tale. The company provides software and driver-assist systems for several Chinese automakers through a collaboration model rather than manufacturing vehicles directly. This business generated at least $6.7 billion in revenue in 2025. Yet deliveries of Huawei-powered vehicles fell 29 percent year-over-year in September, marking the third consecutive month of declines. China's broader auto market shed over 20 percent in sales volume through late September, while new energy vehicles fell 13 percent—underscoring both structural headwinds and Huawei's struggle to sustain growth even in its home market.
