Chinese mainland smartphone maker Xiaomi Corp said that its revenue rose by 34.5 percent on a yearly basis to 72.2 billion yuan (around $11 billion) during the third quarter of the year, the fastest growth in revenue in two years.

Wang Xiang, president of Xiaomi, expressed concerns over "supply chain shortage" in the whole industry in the fourth quarter during an earnings call late Tuesday. Despite the challenges, the company remains confident about its business for the rest of this year, he said.

Analysts said that Xiaomi's revenue rose as its smartphone business benefited from the restrictions imposed by the United States government on Huawei Technologies Co Ltd. But with Huawei resuming the production of 4G smartphones, according to reports, Xiaomi is expected to face stiffer competition in overseas markets next year.

Xiaomi said it shipped 46.6 million smartphones from July to September, up 45.3 percent on a yearly basis. Specifically, more than half of Xiaomi's third-quarter revenue came from overseas markets, which grew by 52.1 percent on a yearly basis to 39.8 billion yuan, the company said. Its smartphone shipments to Europe grew by 90.7 percent on a yearly basis in the same period, according to market research company Canalys.

The company reported an adjusted net income of 4.1 billion yuan for the third quarter, beating earlier projections of 3.3 billion yuan. But it is also worth noting that Xiaomi's internet services like music and video grew by just 8.7 percent, compared with 29 percent a year ago in the corresponding quarter.

Xiang Ligang, director-general of the Information Consumption Alliance, a telecom industry association, said Xiaomi has gained a lot from Huawei's loss in overseas markets.

On Tuesday, Shanghai-based financial media outlet Yicai reported that Huawei has resumed production of its 4G smartphones. The US chip giant Qualcomm Inc told China Daily earlier this month that it had obtained a supplier license for a number of products, which include some 4G products, to continue its shipments to Huawei.

Yicai quoted a source from Huawei's supply chain as saying that currently Huawei's orders are placed in small batches, and there is no way to estimate the specific order volume. But these finished 4G phones are expected to be available in the market in the first half of next year, or in the first quarter at the earliest, in accordance with the smartphone shipment rhythm, the source said. Huawei did not respond to comments on the issue, when contacted.

Analysts said the production resumption will help Huawei to maintain its cooperation with existing retail partners in overseas markets such as East Europe, Russia, the Middle East and Africa where 4G products are still popular among consumers.