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Huawei Turns to Homegrown-Chip Phones as EV Sales Slide

Huawei released its Mate 90 series on Oct. 1 using its own LogicFolding chip, with executive director Richard Yu saying the company aims to rebuild overseas phone share as China phone and Huawei-backed vehicle sales decline.

AI News Feed · 2026-10-08 19:14

Richard Yu, a Huawei executive director and chairman of the consumer business, told reporters ahead of the launch that the company aims to recover its overseas market share. He said Huawei shipped more than 240 million smartphones in China and elsewhere in 2019, with a goal of 300 million units that year, but now sells only several million smartphones outside China annually. Yu said the company plans to expand its HarmonyOS operating system to overseas markets within one to three years, and hopes China's chip manufacturing capacity will one day allow overseas sales of devices carrying self-developed chips. According to CNBC, the media roundtable before the Mate 90 launch was Yu's first with foreign press since 2019.

That year, U.S. restrictions cut Huawei off from Google's Android operating system and from semiconductors made by TSMC. As the sanctions took effect, Huawei's consumer business, once its largest by revenue, halved to about $34 billion in 2021 from a year earlier. It has since grown to around $51 billion in 2025, or 39% of total revenue, according to CNBC calculations.

The phone push comes as China's smartphone market has weakened. According to Counterpoint Research, sales fell by double digits year on year in both August and September. Huawei worked through the Oct. 1 National Day holiday to release the Mate 90 series, its first phone using the company's LogicFolding chip.

Huawei entered the electric car business by working with several Chinese automakers and has built a unit with revenue of at least $6.7 billion in 2025, according to its annual report. The company has said it does not manufacture the cars, but supplies the software interface and driver-assist system. Unlike other Chinese electric vehicles that have expanded rapidly into export markets, Huawei-powered vehicles so far are concentrated in China.

China's auto market is on course for its worst year since 2021, with sales down more than 20% over roughly the first three quarters through Sept. 27, according to China Passenger Car Association data. Sales of new energy vehicles, including battery electric and hybrid models, fell 13% over the same period.

Deliveries of Huawei-powered vehicles dropped for a third consecutive month in September, falling 29% from a year earlier, according to CNBC calculations of publicly available figures from the Harmony Intelligent Mobility Alliance, the software system behind the vehicles. HIMA, whose five vehicle lines reflect partnerships with manufacturers including Chery and Seres, delivered just under 37,500 vehicles in September. Market leader BYD posted double-digit gains in each of the past three months, with sales well above 400,000 units a month, while Leapmotor has topped 100,000 deliveries a month since July, according to company data. More than 1.56 million Huawei-powered vehicles have been sold since the first such car launched in late 2021. Tesla China had not reported September deliveries as of Wednesday afternoon.

Yu presented the first car fitted with Huawei technology, the Aito M5, in December 2021. Seres Group, which makes the Aito EV line, has seen its Shanghai-listed shares fall by more than 60% so far this year. On Oct. 1, Huawei said it had signed with Seres to cooperate for another five years, including the joint establishment of an Aito business team. Mainland China markets are set to reopen Thursday after closing for the Oct. 1 holiday.