Huawei and Xiaomi are the two biggest players in China at the moment. These two companies are constantly trading places as number one smartphone OEMs in China, and have been able to sell a ton of devices both last and this year.

Research company Canalys called it a "remarkable feat" by Huawei, best known outside China for its network equipment, and one that puts Xiaomi under tremendous pressure to maintain its growth rate elsewhere in the world.

Xiaomi was out-selling Apple in China at the time, and it built a cult-like following selling smartphones with high-end features at low prices.

But China's smartphone market has matured, and local players like Huawei and ZTE, anther network vendor that once sold low-end handsets, have been moving up the food chain.

It's the first time Huawei has led China's smartphone market. It's shipments grew 81 percent year over year, Canalys said, while Xiaomi's declined.

Huawei has won praise for a few new smartphones this year, including the Huawei P8, Huawei P8 max and the Huawei Mate S.

Xiaomi is expected to release their Xiaomi Mi5 flagship before the end of the year, while Huawei might announce the Huawei Mate 8 and Huawei P9 in the coming weeks as well. Both of these devices have been surfacing all over the internet for months now, and they will surely impact sales number of these two companies significantly.

It has set itself a goal to sell 80 million phones worldwide this year. In September it said it was confident it would still reach that goal, after selling slightly less than 35 million handsets in the first half.