Smartphone shipments in China continued their downward trend in Q1, falling 5 per cent from a year ago to 104.9 million, as increasing market saturation and the slowing domestic economy curbed demand.
China, which accounted for nearly one in three of the smartphones shipped globally last quarter, is still by far the world’s largest smartphone market.
Without China helping to drive growth, the global smartphone market decreased 3 per cent in Q1 to 335 million units, according to Strategy Analytics.
The drop of nearly five million units in China during the quarter came despite spectacular growth for three out of China’s top five vendors (see chart below, click to enlarge). The top five’s market share increased from 49.7 per cent in Q1 last year to 63.7 per cent last quarter.
Oppo was the star of the quarter, moving into the second spot, with a 67 per cent surge in shipments to 13.2 million. Its share rose from 7.2 per cent in Q1 2015 to 12.6 per cent last quarter. Little-known Vivo grew its market share from 7.3 per cent to 11.9 per cent year-on-year, taking it past Apple to fourth, as shipments climbed 56 per cent to 12.5 million units.
Xiaomi and Apple accounted for much of the softness in the market, with their collective shipments dropping by 3.2 million units. Xiaomi, which was the top vendor a year ago, reported an 8.5 per cent fall in shipments to 12.8 million, pushing it to third. Apple suffered a 17.4 per cent decline as shipments fell to 11.5 million and it moved to fifth place with an 11 per cent share.
Pressure at the top
Despite Huawei’s strong growth over the past year, Strategy Analytics executive director Neil Mawston said there are signs that its growth in the high-end segment is starting to slow, as rivals like Oppo and Vivo step up their game.
He said Oppo’s R and A series models have been well received in second-tier cities and rural areas, and its micro-innovations, such as flash charging technology, have also helped it gain more attention in urban areas such as Shanghai.
Xiaomi is facing tough competition in mid-tier segments from Huawei and Samsung — its market share fell to 12.2 per cent from 12.8 per cent in Q1 2015.
Shipments by other vendors, categorised as “others”, plunged 31 per cent to 38.3 million units, with their market share dropping from 50.3 per cent to 36.5 per cent.