Huawei Selling Honor Smartphone Business? Facts
Yes, Huawei sold its Honor smartphone business. In November 2020, Huawei announced the sale of Honor to a consortium of buyers, a move widely seen as an attempt to keep the Honor brand alive amid US sanctions that cut off Huawei’s access to key chip technology and Google services. The sale was completed, and Honor now operates as an independent company, no longer owned by Huawei.
Background: Why the Sale Happened
Huawei’s smartphone division faced severe restrictions starting in 2019, when the US government placed the company on the Entity List. This meant American companies, including chip makers like Qualcomm and software providers like Google, could not sell to Huawei without special licenses. The impact was immediate: new Huawei phones lost access to Google Mobile Services, which includes the Play Store, Gmail, and YouTube. Outside of China, where those services are essential, Huawei’s market share plummeted.
Honor, which Huawei launched in 2013, was positioned as a more affordable, youth-focused sub-brand. It competed directly with the likes of Xiaomi, Oppo, and Vivo, and it relied on the same supply chain as Huawei. As sanctions tightened, the restrictions on chips and software applied to Honor as well, threatening the entire operation.
By selling Honor, Huawei aimed to let the brand continue without being subject to the same restrictions. The buyer group, which included more than 30 agents and dealers of Honor’s supply chain, was not on the US Entity List, so the new company could theoretically resume business with American suppliers.
The Sale Announcement and Structure
On November 17, 2020, Huawei confirmed the sale in a statement. The buyer was a consortium led by the Shenzhen Smart City Technology Development Group, a company backed by the Shenzhen municipal government. Other investors included several of Honor’s major distributors and retailers. The financial terms were not officially disclosed, but reports at the time estimated the deal at around 100 billion yuan (roughly $15 billion).
After the sale, Honor became a fully independent entity. It no longer had access to Huawei’s research and development resources, nor could it use Huawei’s brand name or logos. However, it did retain most of its existing staff, including senior management, and continued to operate from its base in Shenzhen.
How the Sale Affected Honor’s Phones
One of the most immediate changes was the return of Google services. In early 2021, Honor announced that its new devices would ship with Google Mobile Services, which was a major selling point for international markets. The company also began using chips from Qualcomm and MediaTek, ending its reliance on Huawei’s Kirin processors.
For consumers, this meant that Honor phones were once again viable outside China. The brand launched models like the Honor 50 series in 2021, which featured Qualcomm Snapdragon chips and Google apps. In China, where Google services are not used, the transition was less noticeable, but the company still had to rebuild its supply chain and brand identity.
What This Means for Huawei
For Huawei, the sale was a strategic retreat. The company retained its high-end P and Mate series, but it lost a significant volume driver. Honor had been a key player in the budget and mid-range segments, and its departure left a gap in Huawei’s portfolio. However, Huawei’s leadership framed the sale as a necessary step to ensure Honor’s survival and to protect the broader ecosystem of suppliers and partners that depended on the brand.
Huawei itself has continued to struggle with chip shortages, and its smartphone market share has declined sharply. The company has pivoted to other areas, such as cloud services, automotive technology, and smart home devices, but its smartphone business remains a shadow of its former self.
Honor Today: Independent and Growing
Since the split, Honor has worked to establish itself as a standalone brand. It has launched a range of devices, from budget phones to foldables, and has expanded its presence in Europe, Asia, and Latin America. The company has also invested in its own research and development, though it still shares some technology with Huawei through licensing agreements.
One notable point is that Honor has not fully escaped the shadow of US sanctions. While it can buy chips from Qualcomm and use Google services, it still faces restrictions on certain advanced technologies, such as 5G chips from some suppliers. As of 2024, Honor has focused on building its own ecosystem, including its MagicOS interface, which is based on Android but with its own features.
Common Misconceptions
A frequent misconception is that Honor is still a sub-brand of Huawei. This is not true. The two companies are separate legal entities with no ownership ties. However, they do share some technology and patents, and Honor has acknowledged that it uses Huawei’s HarmonyOS in some of its devices sold in China, though its international models run on Android with Google services.
Another misconception is that the sale was a way for Huawei to circumvent sanctions. While that was likely a motivation, the US government has not treated Honor as a front for Huawei. Honor has its own supply chain, its own management, and its own strategy, and it has been able to operate without the same restrictions that bind Huawei.
Frequently Asked Questions
Is Honor still owned by Huawei?
No. Honor was sold in November 2020 and is now an independent company. Huawei holds no ownership stake in Honor.
Will Honor phones get Google apps?
Yes, since the sale, Honor phones sold outside China come with Google Mobile Services, including the Play Store, Gmail, and YouTube. Some models sold in China may use Huawei’s HarmonyOS instead.
Can Honor use Huawei’s Kirin chips?
No. Honor now uses chips from Qualcomm and MediaTek. It does not have access to Huawei’s Kirin processors, which are manufactured by companies subject to US restrictions.
Did the sale help Huawei avoid sanctions?
The sale was likely intended to allow Honor to continue operating without the same restrictions, but it has not helped Huawei itself. Huawei still faces sanctions and has not regained access to Google services or advanced chips.
Are Honor and Huawei phones compatible?
They share some technology, but they are not interchangeable. Honor phones use different software and may not support all Huawei services. For example, Huawei’s Super Device features work only within Huawei’s ecosystem.
What happened to Huawei’s own smartphone business?
Huawei continues to sell phones, but its market share has declined significantly. It focuses on high-end devices in China and has expanded into other areas like cloud and automotive tech. Its international smartphone presence is limited.
Related
Method: the standard formula for this calculation, rounded as each result states. See how the calculators work or report an error.