Never mind the global slowdown, Oppo, Vivo and Xiaomi are going strong with the highest ever shipments in one quarter
If we examine the statistics for the last year, it’s apparent that global smartphone shipments are down 3% compared to the previous year. 3Q 2018 results are equal to 386.6 million units. The top 10 market players now cover 79% of the market, while the remaining share is left for the remaining brands (over 600 of them) to fight over. Samsung is the absolute leader, with a 19% market share in 3Q. Shipments have, however, been declining for the industry giant as well for the fourth quarter in a row, although the firm has recently had excellent results in India. Chinese company just keep on growing internationally, and the Apple iPhone shipments remained at about the same level, while their revenues increased 29%, due to their average selling price setting a new record at $793.
Experts commentaries claim that this is the first such time when the smartphone market is showing negative results for 3 quarters in a row. The demand is decreasing in top markets like the US, China and Western Europe, which cover about 50% of international smartphone sales. The prolonged replacement cycles lead to an absence of meaningful innovation and improvement in quality of the smartphones.
Oppo, vivo and Xiaomi are demonstrating very powerful performance, and despite the decline in China, the three Chinese brands showed their best results in a single quarter. Huawei is going strong as well, and its level of 50+ million shipments is preserved, making it #2 in 3Q 2018, as before. This means that the giants are becoming less and less dependent on their home front, and move forward to conquer Europe and Asia Pacific.
Some emerging markets, such as India, have demonstrated double-digit increases, but the volume decline in developed markets was so significant that the former couldn’t compensate for it. The smaller smartphone base of the underpenetrated emerging markets was not sufficient to offset the global decline. OEMs can use this situation as chance for long-term growth, and many are indeed entering such markets for sales growth purposes.
It is precisely the fact that major Chinese smartphone companies are venturing out of their home base that makes the emerging markets grow. OEMs have made the competition mode intense and now many of the innovative features from flagships models have trickled down to the lower-priced models. Emerging economies are fighting to maintain their foothold, and the local smartphone companies are also affected
The low-to mid-priced segment is enjoying increasingly more fancy characteristics as the Chinese OEMs are increasing ASP in emerging markets. The affordable premium segment is hereby growing, as those who can’t afford flagship models are now offered a chance to take advantage of their benefits. However, there are still numerous challenges, since the macroeconomic factors in most emerging markets are not entirely positive, and there are more important elements in play that affect users’ switching from a feature phone to a smartphone.
Coveted features like dual camera, AI, full-screen display, more memory add to the devices’ selling price, which helps companies maintain revenue in the face of declining shipment numbers. 5G is likely to be the driver of growth in the developed markets, but that’s still a long time away.Source