According to the latest data released by IDC, in the first quarter of 2024, Honor won the first place in China's smartphone market with a market share of 17.1%, and achieved a year-on-year increase of 13.2%. Huawei has recovered rapidly since its return at the end of August last year, and in the first quarter of this year, it tied with Honor for the first place in the Chinese market, with a year-on-year increase of more than 100%.
This is also after winning the first place in domestic Android phone shipments in the fourth quarter of 2023 and the whole year of 2023, Honor continues to maintain a strong growth momentum. Wang Jiping, vice president of IDC China, said that AI has become a key growth engine for this glory.
AI technology is an important driving force to lead a new round of scientific and technological revolution and industrial transformation, and is also regarded by mobile phone manufacturers as the key to winning the "second half" of the industry. At present, the leading manufacturers have been assembled in the AI track. Zhao Ming, CEO of Honor, said that as early as three years ago, Honor unswervingly chose to take the path of platform-level AI, "Building AI mobile phones and enabling them with AI is an important path for Honor to break through innovation in the past three years."
AI Track: Refactoring and Leading
IDC predicts that the new generation of AI smartphones will grow significantly from 2024, driving a new wave of replacement. A number of market research institutions also said that the global shipments of AI PCs and AI mobile phones will grow rapidly in 2024, and the shipments of AI mobile phones are expected to be the first to exceed 100 million in the future. Since the second half of 2023, the battle for the landing of AI technology has become more and more fierce in the field of mobile phones. Major leading manufacturers have released new products equipped with AI experience.
As one of the earliest terminal manufacturers to deploy AI, Honor began to deploy AI mobile phones in 2016, establishing the initial direction of reconstructing the operating system with AI, and the first generation of Magic series smartphones it launched was equipped with Magic Live intelligence engine, opening the door to the wisdom of mobile phones;In 2022, Honor launched MagicOS 7.0, based on Magic Live's platform-level AI capabilities have created YOYO intelligent lifeforms, which can actively provide scenario suggestions, guidance, and services based on information such as geofencing and user habits.
In January this year, Honor released MagicOS 8.0, an AI-enabled full-scene operating system, and the first flagship model Honor Magic6 series equipped with the system. IDC data shows that the Honor Magic6 series benefited from the increase of AI functions, as well as all-round upgrades such as images and screens, and the shipments in the first quarter of the first sales exceeded the sum of the shipments in the first two quarters of the previous generation of products. Another folding screen flagship Honor Magic V2 equipped with platform-level AI has also seen a surge in sales.
Driven by the Honor Magic series "straight screen + folding screen" dual flagships, Honor's high-end market share of more than $600 increased significantly in the first quarter of this year, with a year-on-year increase of 123.3%, and the high-end market share is second only to Apple and Huawei.
Behind this is a new path for Honor to lead the end-to-end landing of AI technology. Zhao Ming pointed out that "mobile phone AI is not equal to AI mobile phone". Unlike other vendors that use the AI models of third-party application service providers on the cloud side to provide AI functions and build AI applications, the development direction of Honor AI mobile phones is to reconstruct the operating system with AI, thereby enabling and reconstructing all business logic and application services.
Facing the future, Honor also has a complete AI strategic blueprint. On March 18, Honor announced the "AI Enabled All-Scenario Strategy", which divides the AI of smart devices into four layers, namely the first layer uses AI to enable cross-system and cross-device integration, the second layer uses AI to reconstruct the operating system, the third layer is the application of AI on the device side, and the fourth layer is AI device-cloud collaboration.
Zhao Ming emphasized, "With the courage to reconstruct all terminals with AI, HONOR transcends closure with openness, resonates with global innovation, and actively creates a more open and inclusive ecosystem." HONOR Magic is born for AI, and we will continue to lead the transformation of end-to-end experience by building a four-layer AI architecture for smart terminals, and provide consumers around the world with a smarter, more convenient and efficient AI full-scene experience."
Continuous innovation: Break through the boundaries of thinking
It should be pointed out that as one of the most cutting-edge smart terminals with the most intensive application of cutting-edge technology, the competitiveness of mobile phones comes not only from emerging AI technology, but also from multiple comprehensive experiences in the fields of communication, battery life, and imaging.
Zhao Ming said that while Honor continues to unswervingly use AI to enable the entire business strategy, "it will continue to deepen its hardware foundation." Taking the Honor Magic6 series as an example, its innovative experiences such as Honor Hongyan Communication, which reconstructs the direct connection of mobile phones to satellite communication solutions, upgraded second-generation Qinghai Lake battery, Glory giant rhino glass, SLR-level Honor Eagle Eye camera, and Honor Oasis eye protection technology, all have industry-leading advantages.
If Honor wants to maintain these advantages, it must be supported by continuous and high-intensity R&D investment, and Honor is a brand that adheres to "long-termism". Zhao Ming recently revealed that in the past three years, Honor's R&D investment ratios were 10.5%, 11% and 11.5%, respectively, and it is expected that R&D investment will still exceed 11% in 2024.
epilogue
Previously, there was a view that after Huawei's full return, Honor will be greatly affected. Now, judging from market feedback, Honor has not seen a decline in share, but has become an important driving force for the recovery of the smartphone market together with Huawei. IDC said that thanks to the good market performance of manufacturers such as Honor and Huawei, the overall Android market increased by 9.3% year-on-year.
At the same time, IDC emphasized that the use of AI large models and folding screens are still the key to the differentiated competition between Android phones and iOS in the high-end market. Honor's forward-looking AI strategy and continuous technological innovation have enabled it to gain a first-mover advantage. For the oncoming AI era, Honor is also fully prepared. As Zhao Ming said at the end of his MWC2024 journey, "This is also the beginning of our partnership with global partners towards the era of AI."