Huawei, the world’s third largest smartphone brand, posted a 40 percent increase in first quarter sales revenue when they reported their earnings on Monday. The company says they expect to maintain their current growth trajectory throughout the year.

Huawei recorded $245.5 billion yuan ($37 billion USD) in revenue during the first six months of 2016, claiming they have managed to beat the sluggish market with upgraded smartphones and strong network gear sales.

Despite hearty growth figures, Huawei’s operating margin dipped to 12 percent from 18 percent the same time last year. The privately held company diversified their smartphone stock heavily in late 2015 and early 2016, pushing into the premium space occupied by Apple and Samsung.

A saturated Chinese market, particularly in first-tier cities, has slowed smartphone sales and put local vendors under pressure. Huawei has managed to come out on top of competing local brands, including Xiaomi, by aggressively marketing their high-end models abroad while maintaining a significant share of the local budget smartphone market.

In line with previous rhetoric, Huawei CEO Richard Yu said the company’s ultimate aim is to displace market leaders Apple and Samsung to become the world’s largest smartphone vendor. The company will release the results of individual business groups on Tuesday.

Flowing on from an aggressive local campaign, Huawei has been exerting its influence more openly abroad. In recent months the company has engaged in a tit-for-tat legal battle with Samsung over patent infringements. In May, Huawei brought a patent suit against the Korean vendor in both U.S. and Chinese courts. Samsung has since responded with a similar suit in China.

Cate Cadell

Cate is a tech writer. She worked as a journalist in Australia, Mongolia and Myanmar. You can reach her (in Chinese or English) at: @catecadell or catecadell@technode.com

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