Q2 was the market’s second consecutive quarter of growth, as the macroeconomic environment remained relatively positive largely due to the robust performance of the non-oil sector.
There was a noticeable improvement in consumer sentiment compared to 2022, as evidenced by the strong Ramadan sales season this year.
Samsung and Apple continue to lead the market in Q2 2023.
Saudi Arabia’s smartphone shipments recorded 35% YoY growth in Q2 2023, according to the latest research from Counterpoint’s Market Monitor Service. This was the market’s second consecutive quarter of growth, as the macroeconomic environment remained relatively positive largely due to the robust performance of the non-oil sector. Furthermore, there was a noticeable improvement in consumer sentiment compared to 2022, as evidenced by the strong Ramadan sales season this year.
Ramadan sales and e-commerce activity up YoY
Ramadan holds much importance for both consumers and retailers in Saudi Arabia. Lasting 7-8 weeks, the Ramadan sales season is the longest in the country during a given year, with customers spending a significant amount on gifts. During the Ramadan months of 2023, spending activity recorded strong YoY growth. According to the Saudi Central Bank, consumer spending grew 10% YoY in Q2, with the point-of-sale (POS) and e-commerce transactions (MADA cards) also growing 13% and 30% YoY, respectively.
During the Ramadan sales season, OEMs and retailers deploy various strategies to attract customers. This year, these included creative marketing campaigns such as Samsung’s ‘Stay Apart, Stay Together This Ramadan’ and HONOR’s ‘Memories Together’. Offers included attractive discounts, some as high as 50%, bundled offers and free accessories. Some e-commerce channels extended the duration of their sales to further benefit from the positive consumer sentiment.
Additionally, e-commerce activity continues to rise due to digitalization, substantial promotional activity, easy financing options like ‘Buy Now, Pay Later’ (BNPL), and convenient delivery services across the country. OEMs such as Samsung, Huawei and HONOR and e-commerce platforms like Noon and Jarir Bookstore hosted extended sale events, all contributing to growth.
Competitive Landscape
Samsung achieved a 23% YoY growth in shipments during the quarter, benefiting from a stable supply chain and strong festive season performance. The brand saw sustained sales of the cost-effective Galaxy A series, as well as a good show by its new 5G and premium devices.
Apple shipments more than doubled YoY owing to consistent demand for the iPhone 14 series, especially the Pro versions. Besides, the brand greatly benefited from the surge in online purchases and financing options provided by BNPL platforms like Tabby and Tamara.
Xiaomi grew 17% YoY in Q2 2023, maintaining its third spot. The brand recorded growth in the $100-$149 price band driven by the Redmi 12C. The mid-tier Redmi Note 12 series also performed well.
Motorola grew YoY in Q2, driven primarily by its compelling low-to-mid-tier offerings. Motorola has been improving the availability of its new launches in Saudi Arabia, including its latest foldables and the Razr 40 series.
HONOR was one of the fastest-growing brands in Q2 2023, steadily improving product availability, channel presence and participation in domestic promotional events. During the Ramadan season, HONOR offered large discounts on its entire portfolio, from the HONOR 70 to the X series, available across all major channels like eXtra, Jarir and Noon.
Outlook
Saudi Arabia’s smartphone market is expected to record low single-digit growth in 2023. Further, H2 shipments are expected to decline YoY, largely due to Saudi Arabia’s oil production cuts causing a decline in the country’s overall economic activity. Nonetheless, we remain optimistic about the market, as digitalization and 5G networks continue to expand.
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
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
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.”
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.”
Given the absence of most major smartphone OEMs from IFA 2023, HONOR grabbed most of the headlines. And it didn’t disappoint, launching two products that were sure to get people talking: one a masterpiece of engineering, and the other, a masterpiece of thinking outside the box.
HONOR Magic V2
First, we have the Magic V2, HONOR’s latest foldable smartphone that comes only six months after its Magic Vs was launched internationally at MWC 2023. But as we learned from HONOR executives, why wait when such a leap in technology has been achieved? This was quite a poignant statement in an era when most smartphone vendors launch new devices annually, usually without any major upgrades to shout about.
HONOR certainly does have something to shout about with the Magic V2, as the hardware is simply staggering. HONOR has managed to produce a smartphone so thin that it seems to defy physics: at 4.7mm thick when unfolded and 9.9mm thick when folded, the V2 is only slightly thicker than a standard smartphone even when folded. For comparison, the Samsung Galaxy Z Fold5 measures 13.4mm thick when folded, and the Galaxy S23 Ultra is 8.9mm thick. Similarly, at 231g, the HONOR Magic V2 actually weighs less than the iPhone 14 Pro Max or the Samsung Galaxy S23 Ultra, and significantly less than Samsung and Google’s foldables respectively. Overall, it’s the closest to a standard candybar smartphone than any other foldable on the market. And since the dimensions of the front screen are similar to a normal phone, not tall and thin like the Samsung Galaxy Z Fold5, it’s easy to forget it’s a foldable!
But a foldable it is, and the hinge is superbly slick. It occasionally fails to hold itself in an upright position, but it feels solid and leaves no gap at all. The internal screen is beautiful with a 2K resolution, a super-smooth adaptive 120Hz refresh rate, and the crease is hardly noticeable. It feels very premium indeed. The camera is yet to be tested, but the 50MP main, a 50MP ultrawide, and a 20MP 2.5x telephoto lenses, plus AI Falcon Capture, on-paper at least, put it ahead of the Galaxy Z Fold5 and even the Google Pixel Fold. Of course, the latter has Pixel Fold benefits from Google’s image processing technology, but the Magic V2 looks like it will be a very capable snapper.
There are a few downsides. First, the Magic V2 has no IP rating, compared to the Galaxy Z Fold5 IPX8 rating. And secondly is the question of software. Previous HONOR foldables have featured polished software in the way they handle apps and images on the internal screen, but scaling and optimisation are areas for improvement. Time will tell if HONOR has improved with the V2, but I suspect things may still lag the Samsung experience.
However, HONOR has still produced what I think is the best book-type foldable smartphone the industry has seen so far. Sadly, it may not be coming to international markets until next year, which does leave me wondering why HONOR decided to “launch” it now. If the tech is ready (and it’s already available in China), then why not launch it now and get the jump on Samsung? Leaving it until next year gives Samsung a few extra months to try to catch up.
HONOR V Purse
HONOR’s other major announcement at IFA, and the one that attracted most of the headlines was its concept outward folding smartphone, the HONOR V Purse. The device features interchangeable straps and chains that allow it to be carried like a purse or a handbag and uses its outward-facing display to show wallpapers designed to mimic different purse styles.
Little else is known about the device, including whether it will actually be put into production, and to be honest, I don’t think it will be taken very seriously. The personalization possibilities are fun, but I can’t really picture anyone using it with the strap as a “clutch bag” and whacking it on every surface. Also, having such an expensive device clearly on display is asking for trouble.
Even so, it’s a nice example of creative thinking from HONOR, and a welcome attempt to differentiate in a segment where devices are already all looking the same.
Our Q2 2023 Market Monitor report has been published. We release one infographic each quarter to summarize the global smartphone market activities in a single page.
Some quick observations on the smartphone market:
Global smartphone shipments declined 9% YoY in Q2 2023 to reach 268 million units.
Samsung remained the top smartphone player in Q2 2023, while Apple saw a cyclical decline.
Among the top five brands, Apple experienced the smallest YoY shipment decline. Among the top 10 brands, TECNO and Infinix, part of the Transsion Group, saw double-digit YoY shipment growth in the quarter.
In terms of regional performance, only the Middle East and Africa (MEA) exhibited annual shipment growth while North America experienced the highest decline.
The top five brands accounted for almost 80% of the total 5G smartphone shipments in Q2 2023.
Use the button below to download the high resolution PDF of the infographic:
Smartphone sales in China fell 4% YoY in Q2 2023. The sales continued to decline in April and May, while the 618 e-commerce festival provided a boost in June.
Among OEMs, vivo reclaimed its leadership position with a 17.7% market share. OPPO (including OnePlus) and Apple were in a tie in Q2, each capturing 17.2%.
Apple, Huawei and realme managed to achieve positive YoY growth. Huawei’s smartphone sales grew 58% YoY driven by a bigger product portfolio.
Apple’s sales increased 7% YoY as its position in the premium segment remained unchallenged.
Beijing, New Delhi,Hong Kong, London, San Diego, Buenos Aires, Seoul – July 28, 2023
China’s smartphone sales fell 4% YoY in Q2 2023, reaching the lowest Q2 sales figure since 2014, according to Counterpoint’s Market Pulse Service. The macro headwinds, both internal and external, took a toll on Chinese consumer sentiment.
In April and May, smartphone sales remained weak, while the 618 e-commerce festival provided a boost in June, resulting in a 25% MoM growth. However, despite the sequential increase in June, the relatively weak performance observed during the 618 sales period (June 1 to June 18), with an 8% YoY decline according to Counterpoint’s 618 Sales Period Thematic Report, ultimately led to a 6% YoY decline for the full month of June.
Source: Counterpoint Market Pulse Service Notes: OPPO includes OnePlus; Xiaomi includes Redmi; vivo includes iQOO; Figures may not add up to 100% due to rounding
Among OEMs, Apple, Huawei and realme managed to achieve positive YoY growth. Apple maintained excellent sales performance with 7% YoY growth as its position in the premium segment remained unchallenged. The premium segment has proven to be more resilient during economic headwinds. Even within Apple, the sales share of the more premium Pro models grew from around one-third in Q2 2022 to around half in Q2 2023.
Sales of OEMs excluding Apple dropped 5.5% YoY, with all major Android OEMs except Huawei and realme seeing YoY declines. In terms of market share, vivo reclaimed its leadership position with a 17.7% share driven by a strong performance of the Y35 series, Y8 series and the newly launched S17 series. OPPO (including OnePlus) and Apple were in a tie in Q2, each capturing a 17.2% share.
Notably, OnePlus managed to maintain its strong growth momentum from Q1 2023 and achieved YoY growth of 254% in Q2 on the back of channel support from OPPO. On the other hand, OnePlus played an important role in compensating for OPPO’s limited online presence by using its online-centric business model to effectively tap into the segment.
Huawei’s smartphone sales grew 58% YoY in Q2 2023 as the brand managed to resume normal product launches this year. Leveraging its well-established brand image and strong offline footprint, especially in top-tier cities, Huawei witnessed a surge in sales after resolving its product shortages.
HONOR and Xiaomi saw their market shares drop in Q2 2023 on escalating competition. But HONOR has been catching up in offline presence in China.
With a disappointing performance in H1 2023, we have revised downwards our 2023 forecast for China’s smartphone market – from flat growth to a low single-digit YoY decrease. While we anticipate an improvement in smartphone sales during H2 when compared to H1, a strong rebound does not seem to be on the horizon as challenges that affected the performance in H1 are likely to persist.
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.
Smartphones with fast charging (>10 watts) accounted for almost 80% of global smartphone sales in Q1 2023, compared to 74% in Q1 2022.
In Q1 2023, the average power for fast-charging smartphones globally reached 34W, compared to 30W in Q1 2022.
Chinese smartphone brands are leading this trend by introducing higher-wattage charging across different price points.
London, San Diego, New Delhi, Beijing, Buenos Aires, Seoul, Hong Kong – July 20, 2023
Sales of fast charging-capable (>10 watts) smartphones accounted for almost 80% of the global smartphone market in Q1 2023, compared to 74% in Q1 2022 and 29% in Q1 2018, according to Counterpoint Research’s Global Quarterly Smartphone Fast Charging Report. The increasing adoption of fast charging-capable smartphones is attributed to growing smartphone usage and continuous advancements in hardware.
Need for fast charging
Nearly half of all smartphone users spend at least five hours a day on their devices.
They use the smartphone to stay connected with friends and family, browse the internet, stream content, and play games.
Besides, advances in smartphone technology, such as the widespread adoption of 5G connectivity and improvements in cameras, displays and processors, have increased the smartphone’s power requirement while enhancing the overall user experience.
These factors have, in turn, led to the demand for smartphones that can be charged faster to ensure uninterrupted usage for at least a full day. As a result, smartphone brands have recognized the importance of fast-charging capabilities and started to embed them in their portfolios.
Fast charging differentiating feature for smartphone brands
Chinese brands are leveraging fast charging as a selling point to attract consumers. For instance, realme and Xiaomi offer smartphones with power capabilities exceeding 200W. Furthermore, Xiaomi and OPPO recently showcased smartphones with an impressive 300W fast charging capability. These brands aim to provide extremely fast charging speeds, enabling users to charge their phones within a few minutes.
Smartphone brands are focusing on making the fast-charging technology affordable. Smartphone brands are embedding fast charging into their lower-priced models as a differentiating factor. While fast charging has already become a standard feature in the >$200 price segment, smartphone brands are now focusing on providing higher-power charging in this segment to achieve the fastest charging speeds. In Q1 2023, the average power for fast-charging smartphones globally reached 34W, compared to 30W in Q1 2022 and 18W in Q1 2018. Smartphones capable of delivering more than 30W can fully charge a completely drained phone in approximately an hour. Charging a smartphone within an hour can be a compelling selling point for smartphone brands.
Chinese smartphone brands are leading this trend by also introducing higher-wattage charging across different price points, especially in the Chinese market where the average power is 50W. On the other hand, brands like Apple and Samsung have focused more on prioritizing battery safety and overall performance over pushing for higher-power chargers.
A few years ago, it was common for smartphones to require hours to charge. But now it has become the norm for recharging to be accomplished in an hour or less, with the fastest achieving a full charge from empty in a few minutes. However, the race to provide faster charging has reached a point of diminishing returns and we expect a shift in emphasis toward other areas of technology in the smartphone in coming years.
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.
Weak customer demand amid economic headwinds hit smartphone sales during the 618 period this year (June 1-June 18).
vivo took the biggest market share during the sales period while Huawei experienced significant growth.
Online-centric Xiaomi increased most sequentially this year. It offered bigger discounts on select high-memory products.
Our forecast for China’s smartphone market has been revised downwards to reflect the latest developments.
China’s smartphone sales fell 8% YoY during the 618 sales period in 2023 (June 1-June 18), indicating weak customer demand for smartphones amid economic headwinds, according to Counterpoint’s 618 Sales Period Thematic Report. In terms of the competitive landscape for smartphone brands, vivo secured the largest share in the 618 sales period this year, capturing 18.2% of the market. vivo was followed by Apple at 17.9% and HONOR at 15.4%.
Apple continued to excel in the premium segment, exhibiting an 8% YoY increase without facing any significant competition. To boost iPhone sales during the 618 period, e-commerce websites offered discounts of around 20%.
Huawei saw a substantial 52% YoY growth in sales. The company declared that it had resumed normal product launches this year, unveiling smartphones ranging from the Mate X3 to Enjoy 60 series in H1 2023, covering almost all price segments. The accelerated pace of product launches is expected to contribute to Huawei’s sustained rapid YoY growth in H2 2023.
Note: 2023 618 period starts from June 1st to June 18th; vivo includes iQOO; Xiaomi includes Redmi. Source: Counterpoint Market Pulse Service
The price cuts implemented by OEMs proved effective in helping the market recover from the significantly low smartphone sales witnessed in May and April. During the June 1-June 18 period, the total market sales increased by around 30% compared to the previous 18 days.
Online-centric Xiaomi increased most this year in sequential terms. It offered bigger discounts on select high-memory products. Xiaomi also expanded its product portfolio by introducing the K60 16GB+1TB variant at a competitive price of RMB 2,899 (~$400).
The weak sales during the 618 period also fell short of earlier expectations, despite efforts by most Android OEMs to entice consumers with price cuts. Due to the uncertain economic outlook, consumers were more cautious in their spending, including on durable goods like smartphones.
As a result, we have revised downwards our 2023 forecast for the China smartphone market, from flat growth to a low single-digit YoY decrease.
Our Q1 2023 Market Monitor report has been published. We release one infographic each quarter to summarize the global smartphone market activities in a single page.
Some quick observations on the smartphone market:
The global smartphone market declined by 14% YoY to reach 280.2 million units in Q1 2023.
Samsung surpassed Apple as the leading smartphone player in Q1 2023, driven by the success of its mid-tier A series and the recently launched S23 series.
Among the top five brands, Apple experienced the least YoY shipment decline, resulting in its highest-ever Q1 market share of 21%.
OnePlus emerged as the fastest-growing top-10 smartphone brand globally, with significant contributions to this growth from China and India.
In terms of regional performance, the Middle East and Africa (MEA) market exhibited the only single-digit decline at 8%, although this was based on a relatively small market size.
Europe saw the largest decline for any region, with a 41% decrease, primarily driven by Russia and Central and Eastern Europe.
Use the button below to download the high resolution PDF of the infographic:
The Saudi Arabia smartphone market was among the few to record YoY growth in Q1 2023.
Even as many economies struggled in 2022 amid macroeconomic and geopolitical pressures, Saudi Arabia was bolstered by its highest oil revenues in decades, all-time-low unemployment rates, all-time-high non-oil economic activity and strong private consumption.
Among OEMs, Samsung and Apple continued to take over half of the total smartphone shipments in Q1 2023, with Samsung taking the #1 spot.
We expect the Saudi Arabia smartphone market to continue its growth momentum in 2023, with annual shipments likely to grow in low single digits.
The Saudi Arabia smartphone market was among the few to record YoY growth in Q1 2023, with shipments growing 26% YoY largely due to strong macroeconomic fundamentals, accelerating digitalization, and growing device financing options. In QoQ terms, the shipments grew 17% as OEMs filled channels for the Easter and Ramadan sales season, towards the end of the quarter.
Growth drivers
As many global economies struggled in 2022 amid macroeconomic and geopolitical pressures, Saudi Arabia was among the few to buck the trend. Bolstered by its highest oil revenues in decades as global oil prices soared, Saudi Arabia was the fastest-growing economy in 2022, with all-time-low unemployment rates, all-time-high non-oil economic activity and strong private consumption. PoS (Point of Sale) transactions, e-commerce activity and digital payments have also been on the rise in Saudi Arabia, all pointing to growing digitalization and private consumption. Some of the market momentum at the end of 2022 was carried into Q1 2023, especially after the economic boost provided by the FIFA World Cup in Qatar and the year-end and holiday season of Q4 2022.
Saudi Arabia Smartphone Shipments and 5G Share – Q1 2021 to Q1 2023
While the feature phone to smartphone migration has slowed down in Saudi Arabia, a growing digital economy and an aspirational customer have become key growth drivers. Commercial and private 5G use is also increasing in the country, pushing 5G smartphone sales. 5G technologies are a key part of Saudi Arabia’s digitalization and growth push under the Vision 2030 plan. The country has partnered with major 5G infrastructure players like Huawei and Ericsson, and 5G networks are now available in most major cities, covering around 80% of the country’s population. Saudi Arabia has also been hailed as a 5G pioneer in the region in terms of coverage, speed and consistency. 5G smartphone share remained above half of total smartphone shipments for the second consecutive quarter in Q1 2023 and is likely to grow further in 2023.
Competitive landscape
Saudi Arabia Smartphone Shipments by Top 5 OEMs for Q1 2021, Q1 2022, Q1 2023
Among OEMs, Samsung and Apple continued to take over half of the total smartphone shipments in Q1 2023, with Samsung taking the #1 spot. Xiaomi and Motorola were distant third, with HONOR rounding out the top five for Q1 2023.
Samsung grew YoY as its supply normalized in the region. The brand’s 5G models have been leading growth, especially the new affordable 5G M-series and A-series iterations. The Galaxy M53 was the best-selling Android device in the country in Q1. Samsung’s newest flagship Galaxy S23 series was shipped slightly earlier than the S22 series in 2022 to meet the pre-order demand triggered by aggressive marketing and promotions in the country, with most channels and offline stores participating.
Apple’s smartphone shipments nearly doubled YoY led by the popularity of its iPhone 14 series, especially the Pro versions, and as older models became affordable and available. Apple reached its highest-ever Q1 shipment share in Saudi Arabia in 2023. The brand has greatly benefitted from the rise of financing options, like the ‘Buy Now, Pay Later’ model, in Saudi Arabia, making its devices accessible to a greater demographic. Besides, a rising mean wage and stable exchange rates increased the average Saudi Arabian consumer’s purchasing power in 2022. iPhones took four of the top five spots in the bestseller list for Q1 2023, with the iPhone 14 Pro coming out on top.
While Xiaomi’s shipments grew YoY in Q1, it lost share marginally, as Motorola and HONOR gained share driven by new launches. Xiaomi has been able to maintain share largely due to its broad portfolio across price bands, innovative marketing strategies, and a strong presence across both offline and online channels.
Motorola has been gaining share, led by its offerings in the $150-$249 price band, particularly its G series, which accounted for nearly three-quarters of its total sales in Q1. Motorola has benefitted from improved product availability, especially for new launches, and strong brand pull, especially for middle-income customers looking for upgrades to their lower-segment devices.
HONOR was among the fastest-growing brands in Q1, with its shipments more than doubling YoY. HONOR’s growth is largely due to focused expansion efforts, aggressive launch campaigns and an attractive mid-tier to high-end portfolio. HONOR has also benefitted from utilizing Huawei’s earlier distribution and channel relationships. The HONOR 70 and the X series were the top volume drivers for the OEM in Saudi Arabia for Q1 2023.
Smartphone sales grew YoY across all price bands in Q1 2023 but declined QoQ largely due to seasonality. All price bands except the premium band (≥$600) lost share YoY as consumers moved up the price bands. But the premium band was the fastest-growing band in Q1, led by Apple and Samsung. Apple captured around 85% of the total premium smartphone sales in Q1. The mid-tier ($100-$249) remained the largest price band in Saudi Arabia, capturing nearly half of the total smartphone sales in Q1, with Samsung and Xiaomi taking the top spots in the price band. The lower (<$100) segment grew YoY but, like other non-premium segments, lost sales share during the same period, as customers continued to buy higher-ASP devices with improving affordability and rising aspirations.
Market outlook
We expect the ASP of smartphones sold in Saudi Arabia to continue to rise in 2023, as wage rates improve, financing options become more accessible, and customers move towards better devices. Currently, Apple and Samsung remain best equipped to capture more share of the aspirational Saudi Arabia smartphone market, but the quest for the #3 spot continues. While Xiaomi remains comfortably in the #3 spot, other Android OEMs have been mounting pressure with bolder promotions and marketing activities and aggressive launch strategies. Motorola, HONOR and Transsion Group brands Infinix and TECNO are likely candidates outside the top three to capture market growth.
Going forward, we expect the Saudi Arabia smartphone market to continue its growth momentum, with annual shipments likely to grow in low single digits in 2023. Increasing 5G use, ramping up of digitalization, greater access to financing options and growing aspirations of customers are expected to drive growth.
Note:
ASP & Priceband Analysis done using Wholesale Prices
Our analysts Ethan Qi,Jene Park,Soumen Mandal, Ivan Lam, Shenghao Bai, Archie Zhang, Shaochen Wang and Alicia Gong are currently attending the MWC Shanghai 2023 event (June 28-June 30). In the following posts, you will experience the full force of our presence at MWC Shanghai as we provide unique insights from our analysts, unveiling the industry-shaping impact of this remarkable gathering.
Day 1 Highlights:
Consumer Electronics:
Meizu showcases capabilities in ‘device-vehicle integration’
During MWC Shanghai 2023, Meizu showcased a series of products and technologies, including the Flyme Auto intelligent system-enabled EV models, Meizu 20 flagship smartphone series, Titan glass and the EcarX Antares 1000 Pro computing platform. The Meizu 20 series, released in March 2023, sports the Snapdragon 8 Gen 2 SoC, 6.5-inch OLED display, 144Hz refresh rate and UFS4.0 and LPDDR5X memory combination. The Meizu 20 INFINITY Ultimate Edition features a dual-sided suspended Titan glass design, highlighting the emerging trend of flagship models in China competing to adopt more durable glass materials. Meizu also expects its Flyme Auto system to emerge as a guiding beacon for the deep integration of the smartphone and automotive ecosystems.
Huawei showcases Vision Glass
Huawei showcased its recently launched smart eyewear product Huawei Vision Glass alongside a range of smartphone models and consumer IoT products. Huawei Vision Glass, unveiled in December 2022, features a Micro OLED display that offers an immersive experience equivalent to a 120-inch virtual giant screen. It boasts 1080p full HD resolution and 480nit brightness and supports a wide color gamut of 90% DCI-P3. In addition, it comes equipped with ultra-thin smart speakers and offers adjustable diopters ranging from 0 to 500 degrees.
ZTE presents nubia Pad 3D, world’s first AI-based naked-eye 3D tablet computer
ZTE highlighted the nubia Pad 3D, which showcases the unique “3D light field” technology for superior naked-eye 3D display quality. It also incorporates AI eye-tracking to provide real-time matching of the most comfortable viewing field. Leveraging the AI neural network deep-learning algorithms, it enables instant conversion of 2D content into 3D. During MWC, ZTE announced collaborations with ecosystem partners such as China Mobile Migu, Jiangxi Kejun, China National Publications Import & Export (Group) Corporation and Datang Xishi to provide a wealth of naked-eye 3D scene applications in areas including film and television, live streaming, gaming, education, healthcare, cultural tourism, online conferences, exhibition display, advertising, and more.
Telecom Operators’ Moves
Establishment of China Mobile Metaverse Industry Alliance
China Mobile has collaborated with metaverse ecosystem partners to establish the China Mobile Metaverse Industry Alliance. It unveiled the first group of 24 alliance members at the MWC. The alliance comprises content provider Mango TV, providers of content and software development tools such as Unity, AI technologies leader Iflytek, as well as hardware companies like Huawei, NOLO, HTC VIVE and Xiaomi. They will prioritize cooperation in four key areas – metaverse content creation, XR terminals, key technologies and computational networks.
China Mobile’s 5G Use Case
China Mobile showcased a remarkable 5G use case for automated quality inspection, eliminating the need for wired connections.
China Unicom’s 5G solutions
China Unicom unveiled a groundbreaking 5G-connected solution for traffic lights and cameras.
China Telecom reveals development strategy for 6G
During his keynote speech at MWC, China Telecom chairman revealed that the company was actively pursuing innovative advancements in the architecture of the simplified 6G network. The research primarily focuses on key core technologies, including near-field cellular integration (P-RAN) and air-space integration. China Telecom will maintain a close collaboration with standardization organizations and industry partners to drive the establishment of globally unified 6G international standards.
Innovations from network, software and component providers
Huawei drives 5G ToB advancement with ‘5G Inside’ technology
Huawei not only perseveres in the development of 5G devices but also drives the advancement of 5G ToB. With 5G Inside, Huawei is collaborating with enterprise customers to deliver customized 5G devices that cater to diverse scenarios and applications.
Huawei’s ‘cloud phone’ solution
Huawei offers a cloud phone solution where users can access separate or multiple virtual phones through a dedicated app. This innovative B2B solution is ideal for companies seeking to secure their digital assets and provide virtual phone solutions for their sales staff. Government entities also show interest in this virtual phone solution, while cloud mobile gaming presents another exciting use case.
Huawei’s 5GC Intelligent Traffic Express Solution
Huawei’s 5Gc Intelligent Traffic Express Solution enables the detection and monitoring of user live-streaming activities. In cases where user experience worsens, extra resources are allocated to VVIP users, providing operators with the opportunity to monetize on individuals requiring fast and prioritized connections, such as live-streaming bloggers.
H3C’s Wi-Fi7 Announcements
H3C showcased a compelling use case of Wi-Fi7 enabling remote schooling. The enterprise gateway has the capability to support hundreds of terminals, including tablets and PCs, simultaneously.
China Broadnet’s Naked-eye Display
China Broadnet presents a rejuvenated concept of naked-eye displays.
STMicroelectronics Announcements
STMicroelectronics’ integrated wearable sensing unit, with accelerometers and gyroscopes integrated, can efficiently process signals and directly translate movements into actionable data for smart wearable devices.
AMD’s RFFE Solutions
AMD has introduced an advanced RF front-end solution designed specifically for small cell systems.
AAC Expands its Optical R&D Strength
AAC is significantly enhancing its optical R&D capabilities, particularly in the field of waveguide technologies.
Tongxin Microelectronics Announcements
Tongxin Micro’s NFC chips find wide applications in wearables and smartphones, having already been integrated into various commercial models. Besides, the company serves as a provider of eSIM chips. A solution combining both technologies is currently in the works.
ams OSRAM Mira050 with Wafer Level Optics (WLO) Demo Kit
Smallest lens solution with leading-edge NIR-imaging performance – images are sharp from center to edge of image circle. ams OSRAM designed and produced WLO lens mounted on Mira050 EVK sensor board, actively aligned to optimize image quality. Configurable NIR-designs for wavelengths bands around 850nm or 940nm
Kigen and TMC collaborate to drive eSIM innovation
Kigen and Tongxin Microelectronics Co (TMC) have delivered the first-ever simple, global, secure, commercial and GSMA-certified consumer eSIM solution to empower OEM innovation to meet 5G FWA demand for affordable CPE devices. Lead customers are already developing commercial products based on this offering. The companies are now extending it to general availability.
“Global 5G FWA CPE cumulative revenues are expected to reach over $100 billion during 2020-2030. Bringing down the total cost of 5G FWA CPE is integral to 5G broadband adoption, scale and return on investment for all stakeholders in this price-sensitive segment.” Neil Shah, VP of Research, Counterpoint Research
During the launch event, HONOR CEO George Zhao shared thoughts on innovation in future smartphone products:
Inclusion of AI: George thinks that having AI on the device is vital because it would allow users to have multiple-modal interactions and offers better privacy protection in the future digitalized life.
Screen size matters but so does the smartphone weight: Future smartphones should be easier to carry around as they need to be.
Display technology with eye-care features would become popular: In China, more than 30% of smartphone users use their devices for more than five years. Eye-care display technology addresses the consumer’s concerns.
Longer battery life: Customers want devices with longer battery life since they are using them more and more every day.
At the end of his address, Zhao announced that HONOR’s third foldable phone Magic V2 would be launched on July 12 and the product may bring improvements in the abovementioned areas.
Meizu’s announcements
Meizu’s CEO Shen Ziyu made a keynote speech today, describing his vision of interconnection between the automotive and smartphone segments. Meizu is now owned by Chinese auto giant Geely. Ziyu said the synergy between the two segments would be brought by the sharing of computing power, data and hardware. Automobile operating systems should also become accessible to the huge application ecosystem of smartphones. The company is also working on an infotainment system called Flyme Auto, which will offer the same smooth user experience as seen in the Flyme OS for smartphones. Flyme Auto will be installed on the upcoming Lynkco 08 and Volvo Polestar for the global market.
Day 3 Highlights
Lenovo updates
Lenovo showcased its consumer electronics products such as laptops, tablets and smartphones, including its recently launched foldable Motorola Razr 40 Ultra.
Lenovo also had some ToB solutions at its booths, such as AI server, edge computing products, park patrol robot, smart transportation systems and logistics.
Lenovo also supports many of the firms in its ecosystem which have stepped into XR optical solutions, live-streaming supporting platforms, network equipment and smart logistic management system.
For its smart city business, Lenovo showcased its solutions like smart transportation solutions and city emergency management platform.
China Broadnet showcases new 5G calling features
Making calls interesting: Users can make calls more fun by using all kinds of emojis with gestures or voice commands.
Cartoon video call: Users can create their own digital images that can be displayed when making calls without turning on the camera.
Real-time translation: Multilingual real-time translation into text.
Smart customer service: Available online 24 hours to answer questions.
AI/GPT intelligent call: Using AI/GPT to answer questions.
Keynote: Next frontier for AI
In healthcare, AI can help the doctor detect lesions at an early stage.
AI can help cars enable intelligent electrification, networking and information sharing.
Note: Please note that the posts above are still under development and are meant for providing general information only. They should not be considered professional advice. The authors and this website are not liable for any errors or damages resulting from the use of this information.
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