Global Smartphone Market Archives

Global Smartphone Market Reaches its Lowest Q3 Levels in a Decade; Apple’s Share at 16%

Global smartphone sell-through declined 8% YoY but grew 2% QoQ in Q3 2023.
Samsung led the market but declined YoY to reach its lowest quarterly level in the last decade.
A shorter period of iPhone 15 availability in Q3 led to a shift in demand to the next quarter.
The top five brands’ cumulative share declined in Q3 as challengers’ share grew.
HONOR, Huawei and Transsion Group were among the only top brands to record YoY growth

Global smartphone sell-through volumes fell 8% YoY in Q3 2023, the ninth consecutive quarter to record a decline, but grew 2% QoQ, according to the latest research from Counterpoint’s Market Pulse service. Volumes declined YoY largely due to slower than expected recovery in consumer demand. But the market’s QoQ growth, especially the positive performance in September despite one full week less of sales of the new iPhones, is likely a sign of positive news ahead.

Samsung continued to lead the global market, capturing a fifth of the total sales in Q3. The new generation of foldables received a mixed response, with the Flip 5 outselling its counterpart by nearly twice as much. However, Samsung’s A-series models remained market leaders in mid-price bands. Apple came in second with a 16% market share despite the limited availability of iPhone 15 series, which has been received well so far.

Xiaomi, OPPO and vivo rounded off the top five, with the three recording YoY declines. In Q3, all these brands worked towards strengthening their positions in key markets like China and India, while continuing to slow down expansionary efforts in overseas markets.

HONOR, Huawei and Transsion Group gained share and were among the only brands to record YoY growth in Q3. Huawei grew driven by the launch of the Mate 60 series in China, while HONOR’s growth was led by strong overseas performance. Transsion brands continued to expand while also benefiting from the recovery in the Middle East and Africa (MEA) market.

MEA was the only region to record YoY growth in Q3, owing to improvements in macroeconomic indicators. Most developed markets, like North America, Western Europe and South Korea, recorded steep declines. However, we expect most developed markets to grow in Q4 largely due to the delayed effect of the iPhone launch.

Following a strong September, we expect the momentum to continue till the year-end, beginning with the full impact of the iPhone 15 series along with the arrival of the festive season in India, followed by the 11.11 sales event in China and ending with the Christmas and end-of-year promotions across regions. In Q4 2023, we expect the market to halt its series of YoY declines.

However, the market is expected to decline for the full year of 2023, reaching its lowest level in the decade largely due to a shift in device replacement patterns, particularly in developed markets. Notably, the recovery of emerging markets before the global market and the growth of brands outside of the top five indicate the shifting dynamics and opportunities in the global smartphone market.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media, and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects, and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Counterpoint Research
press(at)counterpointresearch.com

Global Foldable Smartphone Shipments Up 10% YoY in Q2 2023, Set for Substantial Growth in 2024

Although overall global smartphone shipments declined in Q2 2023, global foldable shipments rose.
In H2 2023, competition in the global foldable product market is set to escalate significantly, driven by the earnest entry of Chinese companies like OPPO and HONOR.
The global foldable market is expected to experience substantial growth in 2024, driven by the introduction of entry-level foldable products.

The global foldable smartphone market increased 10% YoY in Q2 2023 to reach 2.1 million units, according to Counterpoint Research’s most recent global foldable smartphone tracker. This growth is in stark contrast to that of the global smartphone market, which showed a 9% decline in shipments during the quarter to reach 268 million units. Due to the prolonged Russia-Ukraine war and the ongoing high global inflation, the smartphone market is expected to grow sideways. Nevertheless, the foldable smartphone sector continues to exhibit robust and sustained growth.

Global and China Foldable Smartphone Shipments, Q1 2022-Q2 2023

Source: Global foldable smartphone tracker

The foldable smartphone landscape in the Chinese market presents a particularly intriguing scenario. During Q2 2023, shipments in the overall Chinese smartphone market slipped 4% YoY to reach 61.9 million units, hurt by the recent economic challenges faced by the country, which led to a reduction in consumer spending. However, the Chinese foldable smartphone market achieved notable success, surging 64% YoY to reach 1.2 million units. China now commands the largest share of the global foldable smartphone market, with a 58.6% share.

Foldable Product Launch Status in 2023: Comparison of Global and Chinese Foldable Markets

Source: Global Foldable Smartphone Insight Report

The rapid growth of the Chinese foldable market is primarily attributed to the introduction of foldable products tailored for the Chinese market, coupled with a strong demand for these products among Chinese consumers. In Q2 2023, significant momentum is building for the continued growth of the foldable market. This surge was driven by the introduction of key products such as the Huawei Mate X3, vivo X Fold 2, and vivo X Flip, primarily targeting the Chinese foldable market. Additionally, the global (including China) launch of the Motorola Razr 40 and Razr 40 Ultra, further contributed to this growth trend. In Q2 2023, China saw the launch of five new foldable products tailored for its market, while the global market outside China only saw two foldable product launches during the same period.

Counterpoint Research Senior Analyst Jene Park said, “We believe that these frequent product launches (along with the marketing effects that accompany product launches) are changing Chinese consumers’ perception of foldable products. Consequently, Chinese consumers can access a variety of foldable products more easily and frequently than any other market in the world. The continuous release of various foldable products is recognized as one of the important reasons why the Chinese foldable market has continued to grow significantly compared to other markets.”

Global Foldable Smartphone Forecast, 2023-2024

Source: Global foldable smartphone forecast

The global foldable smartphone market will undergo significant changes in H2 2023. Chinese manufacturers are expanding their presence internationally during this period, with notable releases including the HONOR Magic V2, OPPO Find N3 Flip, and the yet-to-be-named OnePlus foldable device. Notably, Samsung’s Galaxy Z Fold 5 and Galaxy Z Flip 5, considered to be some of the top-tier foldable offerings, were launched in August and are expected to capture a substantial market share in H2 2023.

Park added, “The global foldable smartphone market is set to see significant growth in the H2 2023, driven by the expansion of Chinese manufacturers. Although Samsung’s market share may dip due to increased competition, we believe that it will be a natural result. However, competition among manufacturers usually has the effect of increasing the size of the market for the product. We believe that the era of the mass foldable phone is expected to start in 2024, mainly led by Samsung and Huawei with their entry-level foldables. Entry-level foldables are expected to be priced around $600 to $700, making them more accessible to consumers.”

Global Smartphone Market Declines for Eighth Straight Quarter; Premium Segment Growth a Silver Lining

Global smartphones sell-through declined 8% YoY and 5% QoQ in Q2 2023.
Samsung led the quarter with healthy A-series demand as Xiaomi and vivo faced headwinds.
Apple came in second with its share growing to 17% despite unfavorable seasonal factors.
Premium segment demand remained resilient, with the segment’s share reaching a Q2 record.

The global smartphone market’s sell-through declined 8% YoY and 5% QoQ in Q2 2023, according to the latest research from Counterpoint’s Market Pulse service. This was the eighth consecutive quarter to see a YoY decline.

Samsung led the market with a 22% market share, benefitting from the strong performance of its Galaxy A-series globally. Apple came in second while recording its highest-ever Q2 market share. Xiaomi, the third-largest brand, faced headwinds in its biggest markets – China and India. The brand is looking to offset such declines with expansion in other markets and by refreshing its portfolio. OPPO did relatively well in its home market China and India (thanks to OnePlus), managing to hold its global market share despite registering losses in Western Europe. vivo (including iQOO) saw major growth declines in China after a strong Q2 last year as well as strong competition from Samsung, and OPPO in the offline markets of India and Southeast Asia.

The global smartphone market now seems to be well past its rapid growth phase, with consumer replacement cycles getting longer, convergence in device innovation, and the emergence of a more mature refurbished market for smartphones hitting particularly the higher-volume low-to-mid-tier price segment demand.

The premium segment ($600+ wholesale price), however, continues to grow immune to broader constraints, as the mature consumer is opting for a superior experience, supported by the easy availability of finance options across key geographies. The premium segment was the only segment that grew during the quarter, reaching its highest-ever Q2 contribution to the overall market. More than one out of five smartphones sold during the quarter belonged to the premium segment.

Apple is riding this “premiumization” wave, reaching record shares in multiple new markets which are typically not considered its core markets. A prime example is India, where it grew 50% YoY in Q2 2023. The continued strong performance of the premium segment has made sure that revenues don’t suffer as much as sales volumes, which is why brands are investing in market expansion and innovation in newer technologies.

All regions worldwide saw a contraction in sales, but the biggest decline was seen in relatively more developed markets such as the US, Western Europe and Japan, all of which recorded double-digit annual declines. The markets in China, India and Middle East & Africa declined relatively less. OEMs and channels looked to clear the excess inventory built up in the market by leveraging promotions and “big sale” festivals. For example, the postpaid carriers in the US rejigged their unlimited bundled plans to offer more flexibility to consumers. But the demand remained weak amid higher interest rates impacting the disposable income of American households. In China too, the premier sales event of “618”, which is spread over several weeks, saw lukewarm reception despite aggressive promotions. However, the event was able to arrest the decline in the smartphone market in China and, indirectly, globally in June.

However, it is not all gloom and doom for the smartphone industry. According to our Smartphone Inventory Tracker, the global smartphone inventory (sell-in vs sell-through) has been reaching healthy levels over the past four to five months, allowing OEMs some breathing room to launch and push newer models in the second half and attract consumers to upgrade, and accelerate the replacement cycle.

We expect the market to recover slowly in the coming quarters.

Background

Analyst Contacts

Ankit Malhotra

Tarun Pathak

Varun Mishra

Neil Shah

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press@counterpointresearch.com

Global Foldable Smartphone Market Continues to Expand, Underpinned by China

In Q1 2023, global foldable shipments grew 64% YoY to 2.5 million units.
China’s overall smartphone market fell in Q1 2023 but the domestic foldable market rose.
OPPO, Samsung grew rapidly in the Chinese foldable market.
Apple is likely to enter the foldable smartphone market in 2025.

Beijing, Hong Kong, Seoul, New Delhi, London, San Diego, Buenos Aires – July 7, 2023

According to the Counterpoint Research Foldable Tracker and Foldable Insight Report, the global foldable smartphone market increased 64% YoY in Q1 2023, based on sell-in volume, to reach 2.5 million units. This is quite significant because the foldable market rose amid a 14.2% year-on-year decline in the overall global smartphone market during the same period. Foldable smartphone markets in almost all major regions, including China, North America and Western Europe, displayed strong growth in Q1 2023.

Global Foldable Market YoY Growth Rate by Major Region, Q1 2023

The robust growth in the global foldable market was largely driven by the growth in the Chinese foldable market. Although the Chinese smartphone market declined by about 8% YoY in Q1 2023, the domestic foldable market continued to grow, surging 117% YoY to 1.08 million units. Commenting on this phenomenon, Research Analyst Woojin Son said, “In China, new foldable products such as the OPPO N2 and N2 Flip had grand releases. These big launch events constantly pique the market’s interest. Consequently, Chinese consumers have become more familiar with foldable products compared to other regions.”

China Foldable Market Share by OEM, Q1 2023 YoY

OPPO’s strong Q1 2023 performance is noteworthy as it reflects the brand’s success in the Chinese foldable market, which is emerging as the world’s largest foldable smartphone market. OPPO ranked second in the Chinese foldable market with a slight gap with leader Huawei, helped by the N2 Flip and N2 which were released at the end of 2022. In particular, the N2 Flip, OPPO’s clamshell-type foldable, contributed a lot to the increase in the sales of clamshell-type products in China, beating Huawei’s Pocket S. Samsung’s growth in the China foldable market is also noteworthy. Samsung made efforts to target the Chinese market by launching the W23 and W23 Flip, which are variants of the Z Fold 4 and Z Flip 4, respectively, produced mainly for the Chinese market and MEA market. This helped Samsung grow rapidly in the Chinese foldable market in Q1 2023. Commenting on the foldable smartphone market outlook for 2023, Senior Analyst Jene Park said, “We believe that, in 2023, there will be 1) intensifying competition among OEMs in the global foldable market due to more aggressive target market expansion; 2) intensifying price competition; and 3) increasing sales volume of clamshell-type foldable smartphones through various product launches. Also, the Chinese foldable market is expected to continue to grow through 2023 mainly due to the Chinese consumers’ recognition of ‘foldables’ as a premium smartphone, coupled with continuous and frequent new product launches in the country.” Addressing the big question around Apple’s entry into the foldable market, Park said, “Apple is still absent from our short-term forecasts. However, since overall consumer response to foldable phones is improving and Apple will be possibly releasing non-phone foldable products soon, the brand’s participation in the foldable smartphone market is likely to occur after 2025.”

Global Smartphone Market Declines 14% YoY in Q1 2023; Apple Records Highest-Ever Q1 Share

The global smartphone market declined by 14% YoY and 7% QoQ to record 280.2 million unit shipments in Q1 2023.
Samsung replaced Apple as the top smartphone player in Q1 2023, driven by its mid-tier A Series and the recently launched S23 series.
Apple’s YoY shipment decline was the least among the top five brands. Consequently, it recorded its highest-ever Q1 share of 21%.
Global smartphone revenues declined by 7% YoY to around $104 billion. Apple, Samsung, Xiaomi increased their Average Selling Prices YoY.

London, New Delhi, Hong Kong, Seoul, Beijing, Denver, Buenos Aires – May 5, 2023

The global smartphone market faced further contraction in the post-holiday-season quarter with shipments declining by 14% YoY and 7% QoQ to 280.2 million units in Q1 2023, according to the latest research from Counterpoint’s Market Monitor service.

Source: Counterpoint Research Market Monitor Preliminary Data, Q1 2023
Note: OPPO Includes OnePlus

Commenting on overall market dynamics, Senior Analyst Harmeet Singh Walia said, “Smartphone shipments declined further in Q1 2023 following the weakest holiday-season quarter since 2013, as the slower-than-expected recovery in China was marred by alarming bank failures on both sides of the Atlantic further weakening consumer confidence in the face of unrelenting market volatility. The smartphone market was also hit by some major brands supplying fewer new devices to a market struggling with high inventories at a time when consumers are choosing to renew less often, but with more durable smartphones when they do buy.”

Consequently, global smartphone revenue and operating profit also declined, although not as much as shipments. This was due, in part, to the lower-than-usual decline in Apple’s shipments, to 58 million units in Q1 2023. Apple thereby managed to capture nearly half of all smartphone revenues. While Samsung’s shipments declined 19% YoY despite growing by 4% QoQ to 60.6 million units, the launch of the Galaxy S23 series enabled Samsung’s ASP to increase to $340, up 17% YoY and 35% QoQ, which in turn contributed to global revenues falling relatively less. Apple and Samsung also remain the most profitable brands, together capturing 96% of global smartphone operating profits.

Source: Counterpoint Research Market Monitor Preliminary Data, Q1 2023
Note: OPPO Includes OnePlus

Commenting on Apple’s performance, Research Director Jeff Fieldhack said, “Apple outperformed the market due to several factors. Firstly, the stickiness of its ecosystem prevents its customers from choosing a cheaper smartphone even in times of economic difficulty. Secondly, with sustainability becoming a priority for many, not only has Apple captured nearly half of the secondary market, it is also attracting users who are willing to spend more for longer-lasting devices. Thirdly, it is the preferred brand for Gen Z consumers in the West and is thereby positioning itself for sustained success. At the same time, it has been filling the void left by Huawei in China’s premium market. So, Apple is able to weather economic and other fluctuations better than its rivals while enjoying unflinching loyalty. This also meant Apple was able to meet the demand for the iPhone 14 series which spilt over Q4 2022, when it had problems at its Zhengzhou factory, rather than that share dissipating or transferring to rivals.”

Besides Samsung and Apple, the biggest global smartphone brands from China, Xiaomi, OPPO* and vivo, will have to wait longer for their shipments to rebound as each of them experienced double-digit annual declines in Q1 2023. This was due to a seasonal slowdown in China at a time when the country’s economic recovery is taking longer than expected. OPPO* has recently been facing challenges in overseas markets too. It has had to exit the German market after losing a patent lawsuit with Nokia. At the same time, the three brands’ revenues and profitability have struggled too. While OPPO* and vivo saw both annual shipment and ASP declines, leading to double-digit revenue declines, Xiaomi’s slight annual ASP growth could also not prevent a double-digit revenue decline in Q1 2023.

The smartphone market as a whole, too, is likely to struggle for the next couple of quarters. Commenting on the near-term outlook, Research Director Tarun Pathak said, “The persistent issues affecting the smartphone market are unlikely to abate anytime soon. Moreover, the recent decision by OPEC countries to cut oil production may lead to higher inflation rates, causing a reduction in consumers’ spending power. As a result, even if the decline in smartphone shipments stabilises, a significant recovery is unlikely before the year-end holiday quarter.”

*OPPO includes OnePlus

You can also visit our Data Section (updated quarterly) to view the smartphone market share for World, US, China and India.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

Analyst Contacts

Harmeet Singh Walia

Tarun Pathak

Prachir Singh

Follow Counterpoint Research

2022 Global Smartphone Shipments Lowest Since 2013; Apple Regained No. 1 Rank with Highest-Ever Operating Profit Share of 85%

The global smartphone market declined by 18% YoY to reach 304 million units in Q4 2022.
Apple replaced Samsung as the top smartphone player in Q4 2022, driven by the recent launch of the iPhone 14 series.
The 2022 global shipments declined by 12% to 1.2 billion units, the lowest since 2013.
Global smartphone revenue declined by 9% to $409 billion, the lowest since 2017.
Apple achieved its highest-ever global smartphone shipment, revenue and operating profit share in 2022.

London, New Delhi, Hong Kong, Seoul, Beijing, Denver, Buenos Aires – February 3, 2023

The global smartphone market remained under pressure in Q4 2022 with shipments declining by 18% YoY to the lowest level for a holiday quarter since 2013, even as they grew by 1% QoQ to 303.9 million units, according to the latest research from Counterpoint’s Market Monitor service. Shipments for the full year 2022 also declined to 1.2 billion units, the lowest since 2013.

Commenting on overall market dynamics, Senior Analyst Harmeet Singh Walia said, “The war in Ukraine, inflationary pressures, economic uncertainty and macroeconomic headwinds kept the consumer sentiment weak in 2022 while smartphone users reduced the frequency of their purchases. The smartphone market remained under pressure in the fourth quarter of 2022 as the cost-of-living crisis, shortage in the labor market and a decline in consumers’ purchasing power resulted in double-digit declines in the shipments of each of the top five smartphone players.”

Consequently, global smartphone revenue and operating profit also saw a decline, although to a lesser degree than in shipments. An increased mix of premium phone offerings by major OEMs drove up the overall average selling price (ASP) by 5% YoY in 2022. The 9% decline in revenue, while lower than in shipments, resulted in annual smartphone revenues amounting to $409 billion, the lowest since 2017. A larger decline was prevented by a 1% growth in Apple, the only top five smartphone OEM to do so.

Commenting on Apple’s performance, Research Director Jeff Fieldhack said, “having proficiently managed its production problems, Apple was able to weather a year already marred by economic and geopolitical turmoil better than other major smartphone players. Its iPhone Pro series continued performing well and its share of iPhone shipments could have been even higher if not for the production issues caused by the COVID-19 breakout at the Zhengzhou factory, which produces the vast majority of Pro series volumes. As a result, some Pro series volumes got pushed to January.”

Consequently, its shipment, revenue and operating profit declined YoY in Q4 2022. However, it outperformed a struggling smartphone market in terms of shipment, revenue and operating profit growth, in turn achieving its highest-ever shares of 18%, 48% and 85% in these metrics respectively, in 2022.

Apple also benefited from the premium segment, its primary constituency, being less severely affected by the economic and geopolitical uncertainties that marred the year. Moreover, mature smartphone users are now choosing premium devices that last longer.

Elaborating on the ‘premiumization’ trend, Research Director Tarun Pathak said, “premiumization can also be seen within the Android ecosystem and is being led by Samsung with its foldable smartphones. As a result, Samsung was the only top five OEM besides Apple to see a 1% growth in revenue, even though its shipments declined by 5% in 2022 and operating profit declined by 1%. The performance of its flagship smartphones was stronger than market projections. Nevertheless, with a smaller profit decline than the overall smartphone market, its operating profit share increased slightly to 12% in 2022.”

Chinese smartphone players suffered from domestic lockdowns for much of the year in addition to facing global economic and geopolitical difficulties. As a result, the shipments of Xiaomi, OPPO* and vivo fell by more than 20% each. Despite offering premium phones at aggressive margins, Chinese brands are yet to make headway in the premium market and have not been able to capitalize completely on Huawei’s decline. Unsurprisingly, then, their revenue as well as operating profit saw double-digit declines.

We expect the market to remain under pressure until the end of the first half of 2023 and to start recovering thereafter.

*OPPO includes OnePlus from Q3 2021

You can also visit our Data Section (updated quarterly) to view the smartphone market share for World, US, China and India.

Background

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

Analyst Contacts

Harmeet Singh Walia

Tarun Pathak

Jan Stryjak

Follow Counterpoint Research

Samsung Reaches its Highest Monthly Market Share in 5 Years

Global smartphone sales declined 8% YoY in April 2022, but Samsung’s sales grew 9% YoY.
Samsung captured close to one-fourth of the global smartphone market in April 2022. This is the highest single-month market share for Samsung since April 2017.

New Delhi, Seoul, Boston, Denver, Taipei, Beijing, London, Toronto, Hong Kong – May 27, 2022

Samsung’s smartphone sales grew 9% YoY in April 2022, capturing 24% of the global smartphone market, according to Counterpoint Research’s Market Pulse Service. This is the highest monthly market share for Samsung since April 2017. The company’s sales grew despite the global smartphone sales declining 8% YoY during the same period. In fact, it was one of the only few brands to grow against the market decline.

The growth helped Samsung to lead the global smartphone market sales for the third consecutive month in 2022. It also became the No.1 brand in the Indian market in April for the first time since August 2020.

Global Smartphone Sales (sell-through) Share of Top 3 Brands, April 2022

Source: Counterpoint Research Monthly Market Pulse

Commenting on Samsung’s April 2022 performance, Research Director Tarun Pathak said, “Samsung captured close to one-fourth of the global smartphone market in April 2022, reaching its highest single-month share in the last five years. This was driven by the strong performance of the S22 series in the premium segment and the A series in the mid-segment. Samsung also had low exposure to the declining China market, which negatively affected sales of all Chinese OEMs. Promotions in some of Samsung’s core markets like Latin America and growth in India, where it became the No.1 brand in April, also helped in expanding its market share during the month. Samsung’s supply chain management through 2022 has also been robust, successfully catering to the demand.”

Commenting on the global smartphone market, Senior Analyst Varun Mishra said, “The global smartphone market declined further in April 2022, reaching the lowest level since the pandemic in 2020. China declined the most, as consumer sentiment weakened due to lockdowns. Sales in Russia also declined in April as key OEMs exited the market and inventory depleted. These factors meant another setback for the market, which was still recovering from the component shortages. LATAM, US and India were the only markets to show growth, but that was not enough to offset the decline in other regions.”

Going forward, Samsung is likely to retain the leadership position in the global smartphone market in Q2 2022. The foldables segment, where Samsung is currently the undisputed leader, also has a lot of potential. Samsung will aim to bring down the prices for foldable phones to gain a competitive advantage.

Please reach out to press@counterpointresearch.com for press comments and enquiries.

You can also visit our Data Section (updated quarterly) to view the smartphone market share for World, USA, China and India.

Some of our other smartphone market analyses for 2022:

Background

Analyst Contacts:

Tarun Pathak

Varun Mishra

Follow Counterpoint Research

press(at)counterpointresearch.com

Global Annual Smartphone Market Grew for the First Time Since 2017; Record Annual Shipments for Apple

Global smartphone shipments grew 4% YoY to reach 1.39 billion units in 2021. Q4 2021 shipments declined 6% YoY to reach 371 million units.
Samsung led the global smartphone market in 2021 with annual shipments of 271 million units.
Apple, Xiaomi, OPPO^ and vivo recorded their highest-ever annual shipments.
The top five brands gained share thanks to a significant decline by Huawei, and LG’s exit from the market.
Apple surpassed Samsung to become the top smartphone vendor in Q4 2021, shipping 81.5 million units.

New Delhi, Hong Kong, Seoul, London, Beijing, San Diego, Buenos Aires – January 28, 2022

The global smartphone market grew for the first time since 2017, with annual shipments reaching 1.39 billion units in 2021, according to the latest research from Counterpoint Research’s Market Monitor service. Despite the 4% annual growth, however, annual shipments remained below the pre-pandemic level due to continued COVID-19 impacts as well as component shortages.

Commenting on the overall market dynamics, Senior Analyst, Harmeet Singh Walia said “the global smartphone recovery in 2021 followed a pandemic-hit 2020 and subsequent pent-up demand in regions like North America, Latin America and India. Growth in the US was driven largely by demand for Apple’s first 5G-enabled iPhone 12 series seeping through to the first quarter of 2021; demand which continued throughout the year ending on a strong Q4 thanks to Black Friday and holiday season promotions. India, too, had a good year due to higher replacement rates, better availability and more attractive financing options in mid-to high-tier phones. However, China, the world’s biggest smartphone market, continued to decline due to supply-side issues caused by the ongoing component shortages, as well as demand-side issues resulting from lengthening replacement cycles.”

Singh Walia added, “the market recovery could have been even better if not for the component shortages that impacted much of the second half of 2021. The major brands navigated the component shortages comparatively better and hence managed to grow by gaining share from long-tail brands.”

Samsung shipped 271 million units in 2021, up 6% from 2020, mainly due to increased demand for its mid-tier A and M series smartphones. Samsung’s annual shipments grew despite supply-side issues starting with its Vietnam factory being shut in June due to COVID-induced lockdown. While its shipments grew YoY to reach 67 million in the last quarter, the growth was limited by intensifying competition from Apple and Chinese brands in some of its markets such as India and Latin America. Nevertheless, the brand gained a good mind share with the launch of its third-generation foldable phones that did well in the premium segment.
Apple’s global smartphone shipments grew 18% YoY to reach a record 237.9 million units in 2021 due to strong performance by the iPhone 12 series. Apple also grew in key markets such as the US, China, Europe and India. In China, it became the top smartphone brand in Q4 after six years thanks to the iPhone 13, consequently overtaking Samsung as the top smartphone globally in Q4 2021.
Xiaomi’s global smartphone shipments grew 31% YoY to reach a record 190 million units in 2021. The bulk of this growth was in the first half of the year, driven by regions such as India, China, South-East Asia and Europe. While its shipments declined in Q3 after a record Q2, it grew marginally in Q4 to ship 45 million smartphones despite slipping to the fifth position in China as it faces severe component shortages.
OPPO^ was another of the top smartphone players to achieve record 2021 shipments, growing by 28% YoY to 143.2 million units. Its performance in China remained strong in the first half of the year, while it grew in Europe, the Middle East and Africa and South-East Asia in the second half. However, shipments remained flat at 33.5 million units in the last quarter due to supply-side constraints.
vivo grew by 21% YoY to reach annual shipments of 131.3 million units in 2021. vivo leveraged its strong offline penetration and a wide-ranging product portfolio to achieve its highest-ever annual shipments globally. In Q4 2021, however, it declined by 9% YoY, as it lost the number one spot in the Chinese smartphone market to Apple.

Other OEMs also had a notable 2021.

Motorola was the fastest-growing brand among the top 10 smartphone OEMs based on annual global shipments. It took advantage of LG’s exit in the US, where it gained share in the sub-$300 price band by offering a strong lineup of widely available devices. It also continued to perform strongly in Latin America while expanding in overseas markets (including a resurgence in Europe).

realme entered the top five android OEMs globally for the first time as its affordable 5G strategy started to pay off. It also did well in markets such as India where it had a record year. The brand continued to expand its presence in new markets such as LATAM, Europe and the Middle East and Africa.

HONOR managed to finish its first full year as an independent OEM with a ranking among the top ten smartphone OEMs globally, and is already among the top five OEMs in China where it benefitted from the reinstation of its relationship with its suppliers since its separation from Huawei.

Transsion Group continued to perform well in its key markets such as South Asia and the Middle East and Africa. TECNO did well in the entry-tier, while Infinix gained the most in the entry-to mid-tier segment, especially in the countries where it is currently expanding. Going forward, Transsion’s fundamentals are expected to remain solid, as it continues to hold significant clout in its home market of Africa.

Research Director Jan Stryjak concluded, “2021 was a tough year, with component shortages adding further pressure to a market battling with lingering COVID-19 issues. However, the world is slowly getting on top of the pandemic, despite the threat of a resurgence towards the end of last year, and with supply issues hopefully coming to an end towards the middle of this year, there is reason to be optimistic for good growth in 2022 as a whole.”

^Note: OPPO includes OnePlus since Q3 2021

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

You can also visit our Data Section (updated quarterly) to view the smartphone market share for World, US, China and India.

Some of our latest regional smartphone market analyses:

India Smartphone Market Crosses 169 Million Units in 2021 to Register Highest Ever Shipments Till Date

Apple Reaches its Highest Ever Market Share in China

Background
Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech

Analyst Contacts:

Tarun Pathak

Harmeet Singh Walia

Aman Chaudhary

Varun Mishra

Karn Chauhan

Follow Counterpoint Research

Apple Reaches its Highest Ever Market Share in China

Smartphone sales in China declined (9% YoY) for the third consecutive quarter in Q4 2021.
Full-year smartphone sales declined (2% YoY) for the fourth consecutive year in 2021
Apple surpassed vivo to become China’s #1 OEM for the first time since Q4 2015, capturing 23% market share, its highest ever.
realme was the fastest growing brand (83% YoY) in Q4 2021.
Four out of five smartphones sold in China in Q4 2021 were 5G capable.

Beijing, Seoul, Taipei, London, Boston, Toronto, New Delhi, Hong Kong – January 26, 2022

Apple surpassed vivo in Q4 2021 to become the #1 brand in China after six years, when the iPhone 6 supercycle was at its peak. Q4 2021 also brought Apple its highest ever market share in China at 23%, according to Counterpoint Research’s Monthly Market Pulse Service. However, China’s smartphone sales in Q4 2021 declined 2% QoQ and 9% YoY, respectively. The country’s full-year smartphone sales also continued the downward trend for the fourth consecutive year, declining 2% YoY in 2021.

Commenting on the overall Chinese smartphone market, Senior Analyst Ivan Lam said, “The market in China continues to decline due to various factors in both the supply side and the demand side. Firstly, the ongoing component shortages are impacting shipments of all OEMs. Secondly, China’s average smartphone replacement cycle is becoming longer. Smartphone designs within brands have also become more homogeneous, especially in hardware, failing to motivate consumers to upgrade. Lastly, China has been experiencing a complex economic environment where exports are driving the growth and domestic spending remains lackluster.”

However, in terms of OEMs, the competition has intensified after Huawei’s decline and the market dynamics are changing rapidly. OPPO was the top OEM in Q1 2021, followed by vivo in Q2 and Q3 and now Apple in Q4.

China Smartphone Market Share, Q4 2020 vs Q4 2021

*OPPO includes OnePlus Source: Counterpoint Research Market Pulse, January 2022

China Smartphone Market Share, CY 2020 vs CY2021

*OPPO includes OnePlus Source: Counterpoint Research Market Pulse, January 2022

Commenting on Apple’s performance, Research Analyst Mengmeng Zhang said, “Apple’s stellar performance was driven by a mix of its pricing strategy and gain from Huawei’s premium base. Apple rose to first place in China right after the iPhone 13 was released (week 39) in September. Afterwards, it remained in the leading position for most of the fourth quarter. The new iPhone 13 has led the success due to a relatively lower starting price at its release in China, as well as the new camera and 5G features. Furthermore, Huawei, Apple’s main competitor in the premium market, faced declining sales due to the ongoing US sanctions.”

vivo and OPPO took the second and third spots respectively, driven by their strong offline penetration and expansive product portfolio strategy. vivo’s performance was driven by the X70 series and S series, and OPPO took off with the Reno 7 series. HONOR also started rebounding in the second half of 2021 after restoring relationships with suppliers. It captured the fourth spot in Q4 2021. Facing more severe component shortages, slower penetration in offline channels as well as competition from HONOR, Xiaomi ranked fifth during the quarter.

The year gone by also proved to be a milestone in terms of Chinese OEMs embracing advanced technology. vivo, OPPO and Xiaomi all launched self-developed chipsets to showcase their investments in semiconductors. OPPO and HONOR also launched foldable flagship models, with more mature designs and highly customized software, especially for Chinese users. Foldables bring a new form factor to the smartphone design. As foldables become more affordable, they are likely to drive some users to upgrade.

Apple’s success in the premium segment is an encouraging sign and will continue to motivate Chinese OEMs to strengthen their footprints in the segment. We expect the smartphone ASP to continue to rise in China as leading OEMs put more effort into increasing it to counter the decline in sales.

Please reach out to press (at) counterpointresearch.com for press comments and enquiries.

You can also visit our Data Section (updated quarterly) to view the smartphone market share for World, US, China and India.

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Analyst Contacts:

Ivan Lam

Mengmeng Zhang

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Apple Captures 75% of Global Handset Market Operating Profit in Q2 2021

The dynamics of the top global handset OEMs keep changing from a shipment point of view, as we saw with Xiaomi becoming the second-highest selling smartphone brand globally in Q2 2021. However, the picture from a revenue and operating profit point of view has stayed much more stable over the past several quarters.

Apple has been the biggest profit and revenue generator in the handset business. In Q2 2021, it captured 75% of the overall handset market operating profit and 40% of the revenue despite contributing a relatively moderate 13% to global handset shipments. While this performance shows the power of the Apple brand, it is still lower than the peak of Q4 2020 when its revenue share reached a staggering 50%, up from 28% in Q3 2020, and its profit share reached an unprecedented 86%, up from 51% in the previous quarter. While there was a significant jump in its shipment share, from 9% to 17% in the same period, the extent of its revenue share reflects the success of its first 5G-enabled iPhone series. Apple also benefits from interoperability between its devices. The convenience with which one may shift between a Mac, iPad and an iPhone encourages users of one Apple device to stay within the Apple ecosystem by acquiring other of the brand’s devices. This is made possible by Apple’s significant control over both hardware and software, enabling a seamless shift of work on an app between multiple devices. While this has been the case for some time, it has become particularly pronounced with the stickiness of music, media, news, storage, etc. Apple is likely to retain this edge, enabling it to continue charging premium prices for its handsets, thus maintaining high operating profit margins.

Samsung, the biggest global smartphone vendor in terms of annual shipments, usually follows Apple in revenue and profit share. There have been two instances when Samsung has failed to generate the second-highest revenue share – Q4 2019 and Q2 2020, when Huawei reached the number two spot. In terms of profit, however, Samsung has consistently been the number two player for the past several quarters.

Despite relative stability at the top, a major shift in recent quarters was caused by Huawei’s decline following the imposition of US sanctions against it. Huawei’s fall has been accompanied by the rise of other Chinese OEMs, particularly Xiaomi, OPPO and vivo, which were the biggest revenue generators respectively after Apple and Samsung in Q2 2021.

While Xiaomi has done very well in terms of shipments, its performance from a profit point of view has not been as strong. This is because Xiaomi has been focusing on excelling in the shipments game in the past few years. Having made strides on that front, its next goal will be to convert its high-volume smartphone business into a highly profitable one. Signs of this shift started becoming visible in 2021 when, for the first time since H1 2019, it generated noticeably positive operating profit as it started launching smartphones with a higher average selling price (ASP). With its recently launched Mi Mix Fold, Xiaomi also entered the ultra-premium foldable phone segment, so far dominated by Samsung. Its other recently launched high-ASP models include the Mi 11i and Mi 11X Pro. However, their relative shipment performance has significant room for improvement, especially when compared with Samsung’s flagship Galaxy S21 series.

It will be interesting to see how Xiaomi and other Chinese OEMs convince their customer base, which they created by selling high-spec devices at relatively low ASPs, to part with larger sums of money that can afford them already popular and well-regarded premium devices.

It may be to this end that the Chinese OEMs have been trying to create greater brand differentiation, as can be seen between Xiaomi, Redmi and POCO; OPPO, OnePlus and realme; and vivo and IQOO.

Besides trying to increase ASPs in their existing markets, these vendors are also trying to expand into newer geographies, particularly Europe. While Xiaomi became the top player there in Q2 2021, OPPO too has done well. Its sponsorship of Euro 2020 and Wimbledon got it much-needed media attention in the region and helped its flagship, the Find X Series.

Nevertheless, Xiaomi, OPPO and vivo will need to work harder to increase ASPs to improve their profit margins in the long run. This is especially true for their new-generation foldable and rollable phones as well as for their flagships. In this, Samsung is already ahead as it focuses on reliable and consistent profit margin, an area in which so far only Huawei came close to challenging it. Therefore, we may see several more quarters of status quo.

The comprehensive and in-depth Q2 2021 Market Monitor is available for subscribing clients.

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