Former Huawei Sub-Brand Honor Bags Strategic Financing
Chinese smartphone maker Honor has secured a new round of multi-billion yuan strategic investment. This is its first known major strategic funding since conducting equity financing in December 2021, after it spun off from Chinese tech giant Huawei in November 2020.
According to public information, six new shareholders were added after the recent round, namely BOE, CICC Qizhi (Shanghai) Equity Investment (Limited Partnership), Rosy Fable Asia L.P., Zonggaigongying (Hangzhou) Equity Investment Fund Partnership (Limited Partnership), Guosen Capital and Shenzhen Baoan District Investment Group.
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Some market participants are worried about whether Honor is facing financial pressure. Although there is no official answer to this question, the firm stated that this round of financing has little to do with the current operating conditions of the company. It added, “Honor’s current income, profit and operating cash flow are growing steadily. Diversified ownership structure has always been the development principle that the company adheres to. It has always adhered to the principles of openness and synergy, and is committed to uniting industrial chain partners to bring global users innovative products and better services.”
Judging from the recent speeches of Honor CEO George Zhao at public events, it can be seen that the firm has made clear adjustments to its future development strategy. This round of strategic financing will become a boost for it to achieve a series of new strategic goals.
Honor has shown good development momentum since it became independent from Huawei. According to market research firm Counterpoint, compared with 2020, the market share of Honor smartphones more than doubled in 2021, reaching 10% and becoming one of the top five smartphone makers in China. George Zhao said that in 2021, Honor got out of the predicament and ushered in a year of recovery.
Since 2022, Honor’s smartphone business has developed rapidly. Counterpoint’s data shows that Honor ranked second in China with a market share of 18.3% in the second quarter of 2022. Moreover, Honor’s sales doubled year-on-year. In the third quarter of 2022, only Honor, Apple and Huawei achieved growth in their smartphone market share, with Honor’s share reaching 17.2%.
After gaining a solid foothold in the Chinese market, Honor aims to accelerate its exploration of overseas markets in 2023. George Zhao pointed out that the firm will firmly explore the global market next year, and that it will also target the high-end sector.
On November 23, Honor will release a new generation of foldable smartphones, the Magic Vs, equipped with the latest MagicOS 7.0 technology.