Smartphone sales have slumped in China, with Q2 seeing the nation revert to volumes last experienced in 2012- the year Samsung launched the Galaxy SIII and Apple gave the world the iPhone 5.
Counterpoint Research Market Pulse for Q2 2022 found that around 60 million smartphones sold in the quarter, less than half of China’s peak moment for smartphone sales in Q4 2016.
Unsurprisingly, the COVID-19 pandemic was citied as a big reason for the slump.
“China’s economy merely grew 0.4 percent year on year in Q2 2022, lower than the market expectation of 0.8 percent to one percent,” said senior analyst Ivan Lam.
Lockdowns in major Chinese cities were the reason for that slowdown and saw Chinese consumers stop spending in many categories – as you’d expect when they were prevented from going outside and China emphasised food supply chains.
High smartphone penetration rates didn’t help, either, Lam said. Big online sales late in quarter caused a sales spike but that surge was 10 percent lower than at last year’s sales.
Vivo retained its place atop China’s smartphone market, but its 19.8 percent market share was a substantial drop.
HONOR grew its market share over 100 percent year on year, from 7.7 percent to 18.3 percent. Apple also managed to grow share, by just one point. Chinese brands Oppo, Huawei, and Xiaomi all lost share. Only Huawei has a non-pandemic excuse, having sold off HONOR and shrunk its range.
Xiaomi did manage improved performance in June, perhaps a sign that the second half of 2022 will bring better days. Lam said foldable phones may also induce buyers to refresh their devices.
But he also warned the market will remain tough.
“Given the low sales volume number for Q2 2022, we expect smartphone sales to rebound in the next quarter,” he said. “At the same time, with the demand continuing to be underwhelming due to weak consumer sentiment and lack of new innovations, it is going to be very hard to make the situation better in the second half when compared to last year.”
Which may not be entirely bad news for the rest of the smartphone buying world, as if Chinese manufacturers lower volumes to meet muted local expectations, supply chain issues could ease for buyers elsewhere. ®
source: The Register