Smartphone sales in China saw highest decline in Q1 2020


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Smartphone sales in China saw highest decline in Q1 2020

Chinese smartphone market underwent its highest decline in the January-March period due to the impact of coronavirus pandemic and Huawei was the only smartphone player that achieved positive growth (year-on-year), a new report said on Wednesday. Smartphone sales in China fell by 22 per cent (YoY) and 24 per cent (quarter-on-quarter) in Q1 2020, according to Counterpoint’s Market Pulse-Monthly Smartphone Sales Tracking service.

The top five — Huawei, OPPO, Vivo, Xiaomi and Apple – accounted for a record 93 per cent of the market, up by six percentage points compared to last year. The market share of Huawei rose to near 40 per cent during the COVID-19 crisis.

“The drastic fall in Q1 China market was primarily dragged down by the dismal sales of smartphones in February (negative 35 per cent), when the country was severely impacted by the COVID-19 pandemic and commerce activities were minimal,’ said Flora Tang, a research analyst at Counterpoint.

However, during the lockdown period in China, local e-Commerce giants such as Alibaba and JD.com managed to sustain efficient business operations and delivery services in major Chinese cities outside of Hubei province.

“For the strong support from these e-Commerce players, China’s smartphone sales appeared less negative than our original expectation. We also estimate that the online share of smartphone sales in China surged to over 50 per cent during Q1 from about 30 per cent in 2019,” she added.

The online share is likely to drop in Q2 after the pandemic is largely contained. Within six months after commercialisation of 5G in China, the penetration of 5G smartphone sales jumped to over 15 per cent in Q1 2020.

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“Sales units of 5G smartphones grew by nearly 120 per cent (QoQ). The dominance of Huawei in China’s 5G smartphone market was more evident as it contributed to over half of the total 5G phone sales in Q1, followed by Vivo, OPPO, and Xiaomi,” explained research analyst Mengmeng Zheng. Apple and Huawei managed to increase market share from the same period last year, clearly out-performing the overall market in Q1 2020.

“Consumers continued to purchase iPhones from e-commerce platforms despite the shutdown of Apple stores across China during February. As for the Huawei group, it continued to lead and gained share with a complete product portfolio covering the entry-level to premium segments,” said Ethan Qi, senior analyst.

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