China smartphone market dips in Q3 despite 5G roll outs

China smartphone shipment has dropped significantly in Q3 2022 despite the roll out of 5G network by leading telecom operators.
China smartphone market Q3 2022China smartphone market fell 16 percent to 67 million units in Q3 2022, according to research report from Strategy Analytics.

Vivo has regained the top position with 21 percent market share, followed by OPPO (including OnePlus), Honor, Apple, and Xiaomi.

Within Top 5 players, only Apple delivered the annual growth this quarter. The report did not mention about the contribution of 5G network roll outs by China Mobile, China Telecom and China Unicom in the market.

This is the sixth consecutive quarter of annual decline by smartphone shipments. Inventory adjustments and the weakening demand weighted on the mixed performance, Yiwen Wu, Senior Analyst at Strategy Analytics, said.
Smartphone in China Q3 2022
Vivo regained the top position in China in Q3 2022 with 14.3 million units of smartphones shipments. Its shipments fell 21 percent and its volume share declined to 21 percent. Vivo refreshed its product portfolio this quarter and it achieved steady progress in premium segment and online channel.

OPPO (OnePlus) combined ranked second with 12.2 million units of shipments, grabbing 18 percent share in Q3 2022. OPPO (OnePlus) posted decline of 27 percent this quarter. OPPO was less aggressive on new product launch in home market amid the economy uncertainties.

Honor yielded the top position to Vivo in Q3 and ranked the third with 12.1 million units. Honor posted 15 percent drop in home market. Honor slowed down its product launch cycle in Q3 and only introduced X40i and X40 in China.

“We expect the competition between Honor and Vivo for the top position will become intensified in the following quarters,” Peng Peng, Analyst at Strategy Analytics, said.

Apple ranked fourth with 10.3 million units of iPhone shipments and 15 percent share this quarter, up from 13 percent one year ago. Apple outperformed the overall market and posted 3 percent growth rate.

Apple’s growth came from the attractive price discounts on iPhone 13 series and the demand of the newly launched iPhone 14 Pro and 14 Pro Max in top tier cities.

Xiaomi dropped to the fifth position in China with 9 million units of shipments. Its shipments fell 16 percent. Xiaomi introduce female-oriented Civi 2, online-focused Redmi K50, ultra-premium Mi 12s Ultra and Mix Fold 2 into the market. These models represent Xiaomi’s latest efforts to expand addressable markets.

Xiaomi is facing tough competition in the online market mainly from Honor. The aggressive offline expansion of Xiaomi has slowed down.

According to IDC report, smartphones shipped in China fell 11.9 percent to 71.1 million in Q3 2022 amid channel inventory adjustments were a focus of the smartphone companies amid the market downturn.

“The gloomy circumstances and clouded outlook of the COVID policy in China are adding uncertainties to the next year’s market outlook,” said Will Wong, Senior Research Manager for Client Devices at IDC Asia Pacific. “Vendors that are able to attract resilient high-end consumers stand a better chance in this challenging environment.”