China Smartphone Shipments – July & YTD
Overall mobile phone shipments in China in July increased 11.8% m/m and saw a y/y increase of 28.6%, the first y/y increase seen on the Mainland since March. We do note that July of 2020 was a weak month last year, following a strong rebound in 2Q ’20, after the onset of COVID-19 in 1Q. The overall trend (black dotted line in Fig.1) remains consistent with the past 2 ½ years. On a YTD basis, total smartphone shipments in China have been 202.82m units, up 15.6% y/y, again noting that the YTD comparison includes the very weak 1Q 2020. Looking at the last 4 months gives a better picture of the state of China’s mobile phone shipments really are, as it shows the YTD for April through July down 17.11% in terms of total mobile shipments.
5G shipments however continue to grow, up 15.4% m/m and 64.2% y/y, and represented 79.6% of total shipments in July, the highest share since we have been collecting data. A relative small number of new 5G models were released in China in July (11, representing 42.3% of total new models), this comes off an unusually large number of new models last month (20), which puts the average around 17 new 5G models/month, but given that Chinese consumers have now been able to buy 5G phones for over two years, there seems to be ample models to choose from, putting the focus on total 5G unit shipments.
Seasonality in the Chinese smartphone market runs (5 year average) 47.8% in the 1st half and 52.2% in the 2nd half. As expected, 2020 was a bit different, with 49.7% in the 1st half and 50.3% in the 2nd, but we would expect this year to be closer to the 5 year average. That would imply 190.2m units for the 2nd half of this year for a total of 364.34m units for the year, up 18.3% y/y and would be the first up year for the China smartphone market since the data was published. Assuming and 80% share of total shipments for 5G smartphones, implied 2H 5G shipments would be 152.16 units, or 279.96m 5G units for the 2021 year, up 88.3% y/y. While the 5G average share of total shipments has been lower than 80% for the year to date (see Fig. 2), the trend has been just under that amount for much of this year and will likely continue to rise for the rest of the year.
We hesitate to forecast Chinese smartphone shipments using averages however, as the pandemic does not seem to have been brought under control as much as we expected, and component shortages could further limit smartphone shipments. We note also that Huawei (pvt) will be a much smaller component of China’s smartphone shipments this year, which is another mitigating factor, however it seems that other domestic and foreign brands have made up the very weak Huawei smartphone shipments thus far this year.
5G shipments however continue to grow, up 15.4% m/m and 64.2% y/y, and represented 79.6% of total shipments in July, the highest share since we have been collecting data. A relative small number of new 5G models were released in China in July (11, representing 42.3% of total new models), this comes off an unusually large number of new models last month (20), which puts the average around 17 new 5G models/month, but given that Chinese consumers have now been able to buy 5G phones for over two years, there seems to be ample models to choose from, putting the focus on total 5G unit shipments.
Seasonality in the Chinese smartphone market runs (5 year average) 47.8% in the 1st half and 52.2% in the 2nd half. As expected, 2020 was a bit different, with 49.7% in the 1st half and 50.3% in the 2nd, but we would expect this year to be closer to the 5 year average. That would imply 190.2m units for the 2nd half of this year for a total of 364.34m units for the year, up 18.3% y/y and would be the first up year for the China smartphone market since the data was published. Assuming and 80% share of total shipments for 5G smartphones, implied 2H 5G shipments would be 152.16 units, or 279.96m 5G units for the 2021 year, up 88.3% y/y. While the 5G average share of total shipments has been lower than 80% for the year to date (see Fig. 2), the trend has been just under that amount for much of this year and will likely continue to rise for the rest of the year.
We hesitate to forecast Chinese smartphone shipments using averages however, as the pandemic does not seem to have been brought under control as much as we expected, and component shortages could further limit smartphone shipments. We note also that Huawei (pvt) will be a much smaller component of China’s smartphone shipments this year, which is another mitigating factor, however it seems that other domestic and foreign brands have made up the very weak Huawei smartphone shipments thus far this year.
China Smartphone Shipments & Y/Y ROC - 2019 - 2021 YTD - Source: SCMR LLC CAIST
China 5G Smartphone Shipments & Share - Source: SCMR LLC, CAIST
China Smartphone Shipments - Yearly & ROC - Source: SCMR LLC, CAIST
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