China's smartphone shipments slumped 21 percent in Q1

Eight of top 10 smartphone brands in China registered negative growth in the past quarter.
Written by Cyrus Lee, Contributor

Smartphone shipments in the world's largest market continued to shrink this year, slumping 21 percent to 91 million units in the first quarter of 2018 from 114 million units in the same period a year earlier -- and marking the biggest quarterly decline since the end of 2013, according to a Canalys report last week.

Huawei, Oppo, Vivo, and Xiaomi have firmly dominated the top positions in smartphone shipments, owning a combined share of 73 percent in the first quarter of 2018, up from 58 percent owned by the four brands a year earlier.

Other brands, including Apple, accounted for 27 percent of the entire shipments in the past three months, down from 42 percent in the first quarter of 2017, suggesting that the Chinese market has been further consolidated and become the playground for major brands only.

Among the top 10 smartphone vendors in China, only two smartphone brands, Huawei and Xiaomi, reported year-on-year growth in the past quarter, whose shipments expanded 2 percent and 37 percent respectively during the three-month period.

The other eight all reported declined shipments last quarter, with Gionee, Meizu, and Samsung being the biggest losers in the market with shipments slumping by more than 50 percent during the period.

Oppo and Vivo, the second and third-largest smartphone brands in China, both saw shipments down around 10 percent for the quarter, according to the report.

"The level of competition has forced every vendor to imitate the others' product portfolios and go-to-market strategies," Canalys Research Analyst Mo Jia said in the release. "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."

Other industry data also indicated similar outcomes.

A report by the China Academy of Information and Communications Technology, a government body in China, said in early April that smartphone shipments in China reached about 82 million in the first three months of 2018, down by 27 percent from the same period last year, according to Xinhua news.

Smartphone shipments started to fall in China about one year ago, and December of 2017 registered the biggest monthly year-on-year drop, when shipments fell by 33.2 percent, said Xinhua.

Another release by industry agency Counterpoint said Chinese smartphone shipments slowed in the first quarter of 2018 with year-on-year decline of 8 percent and sequential decline of 21 percent.

The top five brands, Huawei, Oppo, Vivo, Apple, and Xiaomi, captured a record 82 percent of the market compared with 72 percent in the first quarter of 2017, it added.


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