Analyst firm Canalys reported smartphone shipments in China saw an 11% year-on-year decline in Q1 2023 to 67.6 million units, a fifth consecutive quarter of decline for the Chinese market, as it continues to recover from Covid-19 restrictions.
Apple shipped the most units due to the popularity of the iPhone 14 series, commanding 20% market share equating to 13.3 million units. Oppo which also owns the OnePlus brand, ranked second with 19% market share shipping 12.6 million units. Vivo and Honor shipped 11.3 million and 9.7 million units respectively, securing third and fourth. Xiaomi maintained fifth place shipping 8.5 million units.
Canalys research analyst Lucas Zhong noted China’s economy had “rebounded after the ease of Covid-19 restrictions” but this did not translate to “significant” demand for smartphones. Total retail sales of consumer goods in China increased by 5.8% in China but communication products continued to decline.
Zhong pointed to the pandemic changing consumer behaviour in the medium to long term. Consumers are now focusing on necessary expenses, savings and rational attitudes to consumer electronic goods. The analyst said vendors have to produce “convincing” products to spur device upgrades.
Canalys analyst Toby Zhu added the contracting of the smartphone market had “catalysed intense competition in the entry-level and mid-range segments.” Vendors are launching mid and entry-level devices with flagship chipsets, larger storage, high-spec cameras and fast-charging batteries.
Fellow Canalys analyst Amber Liu said “there will not be a significant recovery of the Chinese smartphone market in 2023” despite “signals of consumer confidence returning”.
“This year will be an important year for vendors to balance their market share and profitability, while also accumulating technological and brand foundations. While adjusting expectations for 2023, the smartphone industry has already turned its attention to 2024 growth plans, seeking further breakthroughs in hardware technology, and implementing more application scenarios in ecosystem construction and AI algorithm capabilities," added Liu.