China’s smartphone sales drop to 10-year low

Smartphone sales in China are on track for their deepest decline in a decade due to a number of factors.

Saturated market, longer upgrade time, and more and more users are the factors that cause the Chinese smartphone market to decline. In the first half of this year, smartphone sales in the world’s largest market fell 21.7 percent year-on-year to 134 million units, according to the China Institute of Information and Communications Technology.

(Photo: Reuters)

Data from analytics firm Canalys shows that the biggest declines belong to Oppo, Vivo and Xiaomi. In the report, Canalys predicts full-year sales could fall below the 300 million mark, the worst since 2012.

The drop in demand is obvious if you visit a major phone brand’s store in Guangzhou. An employee said that customers hold their wallets tightly and sales are not good.

Some stores offer discounts of around 200 yuan ($30). Although it is a summer sale, instead of giving away accessories like last year, this year they reduce the price of products.

The high rate of smartphone usage also makes the market not have much room for growth. About 66% of China’s population has a smartphone, according to research firm Newzoo. Users are also “lazy” to upgrade devices, from 16-18 months to 36 months, a Vivo official revealed.

Besides, it is impossible not to mention the economic disruption caused by Covid-19 prevention policies. Consumers cannot spend as freely as before.

The cooling market has affected the revenue of component suppliers. For example, Shenzhen Goodix Technology, which moves semiconductor production to smartphones, predicts a nearly 95 percent drop in net profit in the first six months of the year from a year ago due to plummeting demand and rising supply chain costs.

Du Lam (According to Nikkei)


Leave a Reply

Your email address will not be published. Required fields are marked *