Smartphone shipments in China continued to decline in the opening three months of 2018, registering the largest quarterly decline ever, data from Canalys showed.
Total shipments dropped 21 per cent year-on-year in Q1 2018 to 91 million units, a number the research company noted was first reached in Q4 2013. The figures follow the first ever annual decline in shipments during 2017.
Eight of the top ten smartphone vendors reported annual declines in Q1 2018, with shipments from Gionee, Meizu and Samsung shrinking to less than half of their respective Q1 2017 numbers.
Despite the decline in shipments, China’s top four vendors – Huawei, Oppo, Vivo and Xiaomi in that order – added market share year-on-year (see chart, click to enlarge), lifting their combined market share from 58 per cent in Q1 2017 to 73 per cent in the recent period.
Market leader gains
Huawei, including its Honor brand, saw shipments inch up 2 per cent year-on-year to 21 million units in the recent quarter, maintaining its lead of the market. Oppo and Vivo both reported annual declines of about 10 per cent to 18 million and 15 million units respectively.
While Xiaomi posted a 37 per cent year-on-year increase in shipments to 12 million units, Canalys noted the figure is skewed by a “lacklustre” 2017. Nevertheless, the vendor regained its top four ranking during the quarter, after losing out to Apple in 2017.
Canalys research analyst Mo Jia said the level of competition forced every vendor to imitate the others’ product portfolios and go-to-market strategies.
“But the costs of marketing and channel management in a country as big as China are huge, and only vendors that have reached a certain size can cope. While Huawei, Oppo, Vivo and Xiaomi must contend with a shrinking Chinese market, they can take comfort from the fact that it will continue to consolidate, and that their size will help them last longer than other smaller players,” Jia said.
After consecutive declines over the last two quarters, China is expected to return to growth in Q2, as Oppo, Vivo and Huawei launch new flagship devices: “The inventory issues that Oppo and Vivo suffered in Q4 and Q1 are now behind them,” Jia reckons.