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India Premium Smartphone Segment Grows 112% YoY in Q2 2023; India Now Among Apple’s Top 5 Markets

India’s premium smartphone segment now contributes a record 17% to its overall shipments.
With an 18% share, Samsung led India’s smartphone market for the third consecutive quarter.
Samsung also surpassed Apple to become the top premium segment (>INR 30,000 or ~ $366) brand.
Apple continued to lead the ultra-premium segment (>INR 45,000 or ~$549) with a 59% share.
vivo maintained its second position. It was the only brand among the top five to experience YoY growth.
OnePlus was the fastest-growing brand in India’s smartphone market in Q2 with 68% YoY growth.

New Delhi, Hong Kong, Seoul, London, Beijing, San Diego, Buenos Aires – July 28, 2023

印度的智能手机出货量declined 3% YoYin Q2 2023 (April-June), according to the latest research from Counterpoint’sMonthly India Smartphone Tracker。Though this decline was the fourth consecutive quarterly decline, its magnitude reduced significantly, from19% in Q1to 3% in Q2. Base effect, pent-up demand and improving macroeconomic conditions helped the market close at less than the expected decline. However, the premium smartphone segment presented a different picture, growing 112% YoY in Q2 to contribute a record 17% to the overall shipments.

在评论马克t dynamics,Senior Research AnalystShilpi Jainsaid, “In Q2 2023, OEMs saw improvement in the inventory and demand situation ahead of the coming festive season. Aggressive measures were implemented by OEMs as well as channels during the quarter to clear existing inventory through multiple sales and promotions. At the consumers’ end, falling inflation and better growth prospects facilitated demand recovery.5Gupgrades also played a major role as OEMs kept launching 5G devices in the INR 10,000-INR 15,000 (~$122-$244) segment for a wider reach. We believe brands will be coming up with interesting launches and offers to lure consumers during the festive season and 5G will be a big growth driver here.”

Source: Counterpoint Research Market Monitor

Notes: Xiaomi includes POCO; OPPO excludes OnePlus; vivo includes iQOO; Figures not exact due to rounding

Commenting on the competitive landscape and brand-level analysis,Research Analyst Shubham Singhsaid, “Samsungremained at the top position for the third consecutive quarter with an 18% market share. The brand also surpassed Apple to regain its top position in the premium smartphone segment (>INR 30,000, ~$366) after one year with a 34% share. Aggressive offers on theZ Flip3and S21 FE, Samsung Finance+ and high demand for the latest premium A-series and F-series devices drove this growth. However,Applecontinued to lead the ultra-premium segment (>INR 45,000 or ~$549) with a 59% share. India is now among Apple’s top-five markets.”

“vivo maintained its second spot in the overall market and was the only brand among the top five to experience YoY growth. Strong offline presence, growth of sub-brand iQOO in online, and multiple launches across price tiers facilitated this growth。OPPOhas been consistently expanding its shipments in the higher-tier segments, with a particular focus on the upper mid-tier range (INR 20,000-INR 30,000 or ~$244-$366), showcasing its strategy to cater to diverse consumer needs. OPPO emerged as the top brand in this segment with a 21% market share.OnePluswas the fastest growing brand in India’s smartphone market in Q2 with 68% YoY growth.”

Other key insights

5G smartphone growth: In Q2 2023, 5G smartphone shipments in India crossed the 100-million cumulative mark as 5G upgrades picked up pace driven by the expansion of 5G networks and availability of affordable devices. 5G smartphone shipments grew 59% YoY during the quarter.
Premiumization trend: The premiumization trend gained momentum as the segment grew at a faster rate of 112% YoY. Rise of a value-based incentive system for retailers, aggressive promotions, availability of credit through various financing schemes, and OEMs’ focussed approach are driving premiumization in India.
Channel dynamics: Offline channel share has been growing and is expected to rise to 54% in 2023. Online-heavy brands like Xiaomi, realme and OnePlus are now emphasizing offline expansion to enhance customer engagement and ecosystem development. Samsung and Apple are also increasing their offline presence to cater to diverse consumer preferences. This shift reflects a more comprehensive approach, leveraging both online and offline channels to create a seamless and personalized customer experience.
4 g功能手机成长th: 4G feature phone share in the overall feature phone shipments increased to 10% in Q2 2023 driven by the JioBharat and itel Guru series’ launch. We believe this share will increase to 18% by the end of 2023. Growing demand for UPI, multiple launches from OEMs and Reliance push will help the segment grow further.
Inventory levels: The market was able to exit Q2 2023 with eight weeks of inventory as Xiaomi and realme managed to clear most of their inventory through multiple sales and promotions.
Other notable brandswhich grew during Q2 2023 were Apple (56% YoY), Transsion (34%), Lava (53% YoY) and Nokia (6% YoY).

The comprehensive and in-depth ‘Q2 2023 Market Monitor’is available for subscribing clients.

Feel free to contact us atpress@www.arena-ruc.comfor questions regarding our latest research and insights.

The Market Monitor research relies on sell-in (shipments) estimates based on vendors’ IR results and vendor polling, triangulated with sell-through (sales), supply chain checks and secondary research.

You can alsovisit our Data Section(updated quarterly) to view the smartphone market shares forWorld,US,ChinaandIndia。

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.

Analyst Contacts

Shilpi Jain

Shubham Nimkar

Tarun Pathak

遵循对比研究

Podcast #64: 2023 China Smartphone Outlook – Reading Between the Top Lines (Mandarin Edition)

AsChinais opening its borders and quickly getting back to business after over three years ofCOVID-19lockdowns and other curbs, we recently conducted an offline customer-sharing meeting in Shenzhen. It was great to see everyone after a long time and share our insights. The developing trends andChina’s premium smartphone marketoutlook were the most discussed topics.

The country’s smartphone market has become quite saturated. While Chinese OEMs are releasing models with newer technologies, the consumer demand for smartphone upgrades is not as strong as before. Moreover,macroeconomicsis another important factor affecting consumers’ purchasing power and confidence. With such a scenario, OEMs are shifting their focus to premium devices to increase their ASPs (average selling prices).

In the latest Mandarin episode ofThe Counterpoint Podcast, hostRick Cuiis joined by Research AnalystsArchie ZhangandShenghao Bai。In this podcast, we touch upon several topics, such as Counterpoint’s prediction for the Chinese smartphone market in 2023, the growing interest of OEMs in releasingfoldable smartphones, and more. We also talk about how smartphone makers are focusing on self-developed chips andartificial intelligence (AI)among other areas of differentiation.

Click to listen to the podcast

You can read theChinese transcript hereand theEnglish transcript here。

Podcast Chapter Markers

01:14:Archie on Counterpoint’s prediction for China’s smartphone market.

02:49:Shenghao on the China smartphone outlook for 2023.

06:24:Archie on the rising ASPs and why OEMs are focusing on premium devices.

08:32:Archie further talks about OEMs’ growing interest in foldable smartphones.

10:40:Shenghao on Counterpoint’s China and global forecasts for foldable smartphones for 2023.

12:16:Archie weighs in on the current innovations in folding smartphones and the room for improvement in the coming generations.

16:35:Shenghao highlights some future development trends for foldable smartphones.

19:42:Almost all flagship smartphones focus big on imaging, but are there other areas for differentiation for OEMs? Shenghao answers.

22:00:Lastly, Archie also shares some insights on self-developed chips, AI, and other developments that smartphone OEMs are focusing on.

Also available for listening/download on:

China Premium Smartphone Market Outlook: Bright Future Ahead

China’s smartphone average selling price (wholesale) has continuously increased since 2014, reaching $385 in 2022.
The share of high-end smartphones (≥$500 wholesale price) in China’s smartphone market increased to more than 26% in 2022. Though the figure still lagged behind that in developed countries, Chinese consumers’ appetite for premium smartphones will continue to grow.
Chinese smartphone OEMs are committed to bringing consumers a better experience. Smartphones have also been improving and changing in terms of features like form factor, computing performance, display and imaging.
Counterpoint expects that the share of the≥$500 segment will reach 40% by 2035.

China’s smartphone shipments fell 16% YoY in2022to less than 280 million units, the lowest in nearly a decade, according to Counterpoint Research’s data. But still, the Chinese market made up 22.6% ofglobal shipments, much higher than second-placed India’s 12.4%.

Benefitting from the popularity of mobile broadband networks, the booming mobile internet content and application ecosystem, and fast economic growth,China’s smartphone marketentered the 2010s with fast growth in shipments and revenues and reached its peak in 2016 with more than 470 million units in shipments. This was also the period when vivo, OPPO, Huawei and Xiaomi developed into major homegrown smartphone OEMs.

However, after the boom ended, smartphoneshipmentsstarted to decline every year. The market also embraced more intensecompetition和oem厂商增加了他们关注产品与众不同tiation. Over the past three years, both supply and demand in the market have been further hit by the COVID-19 pandemic.

More and more people have now started questioning the potential ofChina’s smartphone market。However, we think the market downturn has been exaggerated due to COVID-19, which impacted consumer sentiment and behavior. With China dropping pandemic-related curbs and announcing a 5% GDP growth target for2023, the economy and consumer confidence should gradually recover. China’s smartphone market is expected to see its first positive growth in 2023 after 2016.

China Smartphone Shipments and Average Selling Price (Wholesale), 2012-2022

Source: Counterpoint Market Monitor Service

China’s smartphone sales revenue in 2022 only fell 11.7% from 2016, though the shipments were down 41.5% in the same period. China’s smartphone ASP has been increasing every year since 2014.

4G and 5G technologies and continuously improving core elements such as processors, imaging and displays have increased the manufacturing cost of smartphones. Major OEMs have also started seeking quality and sustainable development in the face of increasing competition. They are focusing more and more on product innovation and differentiation and investing in long-term technological competitiveness, such as operating systems, AI algorithms, computational photography and self-designed芯片。These initiatives are strengthening their R&D capabilities.

Chinese OEMs are also actively practicing social responsibility, such as developing customized features for the visually impaired, hearing impaired and other disadvantaged groups. More environment-friendly materials are being used in smartphone products to promote sustainable development and consumer awareness of environmental protection. These efforts will also help domestic brands grow in the mid-end and high-end markets while offering higher-quality products and services to customers.

The ≥$500 (nearly RMB 4,000 retail price) segment accounted for more than 26% of total sales in China in 2022, up from 11% in 2016 when the market recorded its highest shipments.

With over 1 billion smartphone users, China has become the second-largest high-end smartphone market in the world (nearly 70 million smartphones sold at above RMB 4,000 in 2022). However, compared with other leading high-end markets, China is still well behind in terms of both high-end segment share and individual incomes.

China’s government has announced that the disposable income of its citizens will increase to a new level in 2035, while the proportion of middle-income groups will also increase significantly. Regardless of whether China’s GDP per capita will cross $20,000 (the conventional threshold for a developed country) in 2035, the ASP of smartphones, as well as thepremium智能手机share, should continue to grow amid long-term economic growth and steady consumption upgrade..

Share of≥$500 Segment in Major Regional Premium Markets and GDP Per Capita, 2022

Source: Counterpoint Research

For a long time to come, the smartphone will remain the most important carrier for people’s entertainment, consumption and social interaction, with its lite productivity functions becoming ever stronger. The smartphone itself continues to improve. For example, the popularity of foldable-screen technology adds a new form factor and offers differentiated applications, content and user experience. A larger screen not only steps up the immersive experience for gaming and video but also becomes the optimal production tool for the mobile office with accessories such as stylus and mouse, and fast-developing productivity applications.

Premium Smartphones Will Continue to Improve

Source: Counterpoint Research

Other key elements of the premium smartphone will also improve over time, including processor performance, AI computing power, imaging capability and mobile bandwidth.

首先,最新的3 nm-based芯片组将进入mass production in 2023. The next-generation 2nm technology is also under progress and TSMC plans to realize mass production in 2025. At the same time, chip design houses will develop higher-performance, higher-efficiency micro-architectures or even new instruction sets for processors. This should significantly improve the comprehensive performance of the flagship SoC platform. The computing power of premium smartphones is expected to approach that of PC.

Second, majorAndroid智能手机品牌可以提供更多差异化的铁atures in their premium products with self-developed hardware and algorithm. Taking photography as an example, multi-lens fusion and computational photography have become mainstream. Also, the resolution of the main camera has reached 200 million, which undoubtedly puts forward higher requirements for related AI capabilities and algorithms. Counterpoint believes that OEMs with self-developed chips can better deal with the challenge.

Finally, wireless technology will continue to improve. With large bandwidth and lower latency, smartphones have become the center of content consumption and production. With the advent of computing networks, smartphones will become the super-entrance to cloud applications, cloud games, cloud enterprises and other cloud-based services. In addition, smartphones are becoming more closely integrated into the smart home, smart transportation and smart city. This also means that in the future, smartphones will become more indispensable for us.

In a word, Counterpoint is always long on the potential of China’s premium smartphone market. In 2023, China’s smartphone shipments will recover to more than 280 million units. The high-end segment is expected to outperform the overall market, realizing a YoY growth of nearly 5%. By 2035, both smartphone ASP and premium smartphone share (≥$500) will be up another notch. Premium smartphones will make up nearly 40% of the total market.

Indonesia Premium Smartphone Shipments Grow 21.2% YoY in 2022

The ≥$600 price band grew 21.2% YoY. Apple and Samsung took 68.1% combined share in the band.
Samsung was dominant in the high-end segment ($400-$599) in 2022.
Indonesia’s 2022 smartphone shipments fell 12.2% YoY. The <$200 price band contributed most to the decline.
The $200-$399 price band saw the highest growth of 5G smartphones at 76.3% YoY.

Jakarta, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – February 24,2023

Indonesia’s smartphone shipments declined 12.2% YoY in 2022 on a 23.8% decline in the entry-level segment (<$200 price band), according to Counterpoint’sMonthly Indonesia Smartphone Channel Share Tracker.On the other hand, mid-range to premium smartphones experienced high growth in 2022.The premiumsegment (≥$600 price band) shipments grew 21.2% YoY, higher than the growth of the mid-range (18.8%) and high-end (18.2%) segments. Further, 54.5% of the premium smartphone shipments were that of newly launched models, a growth of 45.8% YoY in such shipments.

Indonesia Smartphone Shipments YoY Growth by Price Band, 2022

Source: Counterpoint Monthly Indonesia Channel Share Tracker, 2022

Entry-level smartphone shipments declined due to lower consumer demand against the backdrop of macroeconomic headwinds. At the same time, the consumer’s need to upgrade to higher categories could have also contributed to the decline in the entry-level segment.

The demand for an upgrade to a more reliable smartphone shot up during the COVID-19 restrictions when offices and schools were attended online. This led to an increase in the shipments of mid-range and above smartphones in Indonesia. Though the pandemic has almost ended, the trend persists. Mobile gaming is another segment that is growing and pushing the demand for smartphones from the >$200 price band.

OEMs too have been bringing various promotions and bundled offers during shopping seasons like Id al-Fitr,Harbolnas, 11.11, 12.12, holidays and year-end.

In the premium segment (≥$600), Samsung and Apple grabbed a 68.1% combined share. Also, thanks to some newly launched models, POCO, Asus,realme, Xiaomi and vivo saw a bigger presence in this category in 2022.

Apple’s iPhone 14 serieswas one of the most anticipated smartphone series in the country in 2022. Erajaya group and Blibli stores offered trade-ins and installment offers to attract consumers. The high demand for the iPhone 14 Pro and Pro Max 512GB and 1TB caused a temporary shortage of these models at the pre-order stage.

In the high-end segment ($400-$599), Samsung and OPPO were the top two OEMs.OPPOwas supported by the Reno 7 5G and Reno 8 5G series. The 5G capability proved to be a good addition to OPPO’s strong marketing and constant promotion of camera capabilities and differentiation.Samsungwas largely supported by the Galaxy A53 5G series. The launch of the Galaxy A53 5G following theGalaxy S22launch could have presented a cheaper alternative to the S22 series for some.

Commenting on the emergence of competition in high-end to premium smartphones,Senior Analyst Febriman Abdillahsaid, “The ≥$400 price segment is expected to continue to grow given newer technology trends and consumers’ need to own a more reliable device with a friendlier user interface to carry out increased digital activities, like finance-related transactions. Mobile gaming has grown a lot in the last year as well. In this case, the features that consumers focus on include a long-lasting battery with fast charging, storage, camera, connectivity modes such as 4G and 5G, hotspot, Bluetooth, NFC and Wi-Fi. As competition increases, pull factors can help brands stay in the market. After-sales service and brand image can be these factors as they provide a sense of security and relevance to the consumer.”

Improved connectivity is a necessity as network technology advances. While5G technologyfocuses on the industrial sector, consumers also see 5G as a technology trend that will reach them sooner or later. Push from retailers and smartphone OEMs has also helped in shaping consumer perception of future 5G needs. Therefore,5G smartphonesare expected to grow faster after the necessary infrastructure is in place. In 2022, Indonesia’s 5G smartphone shipments grew 62.2% YoY. 5G smartphones in the $200-$399 price band grew higher than other price bands at 76.3%.

Outlook

In 2023, Indonesia has the potential to show more resilience compared to other countries in the SEA region. Its population and current growth trajectory will ensure a quick revival of the smartphone market. Q2 2023 onwards, there should be signs of better growth in smartphone sales, if other economic factors do not get worse.

Seeing the progress of digital transformation in this country, more demand for reliable smartphones can be expected. Abdillah said, “As the country is continuing its digital transformation, smartphones are being increasingly used as a point of connection among consumers and businesses. One reason could be the widespread use of applications as entry points for activities in the digital world. This can lead to smartphone upgrades or multi-device use.”

Feel free to contact us atpress@www.arena-ruc.comfor questions regarding our latest research and insights.

Background

Entry-level Smartphone Shipments Bounce Back in Key SEA Countries, Up 28% QoQ in Q4 2022

2022 saw a 13% YoY decline in smartphone shipments in key Southeast Asian countries*.
All countries witnessed a YoY drop in shipments through 2022 with the gap widening to -17% in Q4.
SamsungandApplesustained volumes through the year, while Infinix grew the most.
High-end smartphone ($400-$600) shipments increased 8% YoY in 2022.
Thepremium segment(>$600) witnessed a 23% YoY growth.

Hong Kong, Jakarta, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – February 23, 2023

KeySoutheast Asia(SEA) smartphone markets* saw a somewhat consistent YoY drop in shipments throughout 2022. Inventory was still high in countries likeIndonesia, Philippines and Thailand, which led to a 17% YoY drop in shipments in Q4 2022, according to theMarket Monitor Smartphone Quarterly Report。

More notably, the end of the year signaled a much-awaited increase in demand forentry-level smartphones, resulting in a 28% QoQ increase in such shipments. New launches and pent-up demand played major roles in this. In thepremium segment, consumers kept the demand alive due to which there was a 22% QoQ increase in premium shipments.

Source: Counterpoint Research Southeast Asia Smartphone Tracker, February 2023

While the region’s smartphone shipments declined, countries like Vietnam andPhilippinesshowed more resilience to economic factors than others. Consumer demand seemed to have been less affected by macro effects. Smaller markets like Cambodia, Myanmar and even Malaysia declined relatively more. While they represent a small part of the region, their populations include a higher share of economically disadvantaged consumers. The decline in entry-level smartphone shipments affected these countries more than the rest.

Mature markets like Thailand and Singapore concentrated more on 5G penetration and further stages of industrial5Gapplications. Singapore’s operator partnership with Ericsson and 5G utilization in healthcare planning are just a few examples. InThailand, smart factory technology is being developed, private networks are increasingly used, and operators like AIS are helping out on automation through 5G.

Apart from an uptick in premium smartphone sales in these countries, there was also an increased focus on sustainability in the form of trade-ins,refurbished智能手机demand and corporate ESG initiatives.

Source: Counterpoint Market Monitor Smartphone Report, February 2023

The IT and e-commerce sectors saw job cuts inSEAwhich did not project a healthy H2 2022. Even the online smartphone channels contributed relatively less in seasonal campaigns like 11.11 and December sales. At the same time, OEMs, operators and retailers have been increasing offline networks across geographies. As the economies are struggling to come back to normal, a surge in tourism in this region contributed to the rebound.

Chinese brands likevivo,realmeand Xiaomi consistently struggled with inventory levels and low shipments during Q3 and Q4 2022.OPPOimproved with demand due to its Reno series.

As premium demand surged,Samsung’s S seriesandApple’siPhone 13 and 14 series contributed to these brands’ volumes. Vietnam showed some surprising success with Apple shipments. Apart from newer models, even older ones like the iPhone 11 series were being sold well in the country.

The biggest gainer of 2022 is clearlyInfinix。TheTranssionbrand steadily grew in this region in 2022. Infinix’s focus on basic specs, practical pricing, channel offers and gaming all helped it gain momentum. The brand is especially doing well in the Philippines, Indonesia and Thailand.

Source: Counterpoint Market Monitor Smartphone Report, February 2023

Commenting on theSEAeconomies in 2023,Senior Analyst Glen Cardozasaid, “Southeast Asia suffered on multiple fronts in 2022. Countries continue to increase interest rates, inflation is still a factor and trade volumes are dependent on the partner country’s demands. Any macro-level improvements in tourism, government relief and financial management will take time to positively impact the common consumer. In the absence of further adverse macro effects, the region is on a path to recovery. OEMs are however pessimistic about the recovery at this point and it is visible in their shipment levels. Improving entry-level smartphone shipments is a much-needed boon at this point. H1 2023 is likely to suffer the effects of low shipments, but we are likely to see a steady increase in shipments starting Q2 2023.”

Industrial and consumer 5G use cases will be visible in countries like Singapore and Thailand, while Indonesia and Philippines will concentrate on 5G penetration more than others.

What isChina’sloss is working out to be Southeast Asia’s gain in part.Manufacturingcenters like Vietnam stand to benefit from increased investments from companies looking to diversify from China.

The silver lining lies in the role of smartphones in digital transformation across this region. It also lies in the increase of foreign direct investment. All macro factors remaining constant, H2 2023 has the potential to make up for H1’s losses.

*Key Southeast Asia countries/marketsinclude Indonesia, Thailand, Philippines, Vietnam, Malaysia, Singapore, Myanmar and Cambodia.

Feel free to contact us atpress@www.arena-ruc.comfor questions regarding our latest research and insights.

Background

Analyst Contacts

Glen Cardoza

遵循对比研究

Weak Q4 2022 for MediaTek; Revenues to Further Decline in Q1 2023

MediaTek’s revenue was down 25% YoY and 26% QoQ in Q4 2022.
The mobile phone segment’s revenue declined 25% YoY and 30% QoQ.
MediaTek has downgraded Q1 2023 revenues to $3.0-$3.4 billion, a decline of 35-40% YoY and 3-12% QoQ.
The company has guided the inventory levels to normalize by the end of H1 2023.

MediaTekhas reported $3.4 billion in revenue for Q4 2022, down 25% YoY and 26% QoQ. For the full year of 2022, the revenue was $18.7 billion, up 6% YoY.MediaTek delivereda strong H1 2022 driven by 5G SoCs but a weak H2 2022 due to macroeconomic headwinds and customer inventory adjustments. The QoQ decline was due to theslow China market, weak consumer demand and inventory correction by智能手机OEMs。The mobile phone segment’s revenue declined 25% YoY and 30% QoQ due to aggressive inventory adjustments by customers. The segment contributed 52% of MediaTek’s Q4 2022 revenue.

Highlights

The smart edge segment, which contributed 42% to the company’s revenue in the fourth quarter, declined 18% sequentially due to order cuts from telecommunication operators for inventory adjustment. Revenues from enterprise ASIC andautomotive productsincreased due to growing popularity in the US and Europe regions.
The power IC segment accounted for 6% ofMediaTek’s revenue, declining 37% QoQ in Q4 owing to weak demand from consumer devices such as智能手机s。But the demand for power ICs from automotive and industrial applications increased in Q4.
Changing view from the previous quarter’s guidance, MediaTek downgraded Q1 2023 revenues to the range of $3.0-$3.4 billion, a decline of 35-40% YoY and 3-12% QoQ. Gross margins in Q1 2023 are expected to be around 47.5% and the operating expense ratio around 33%. Most smartphone OEMs will follow a conservative approach to maintaining their inventory.Smart TVandWi-Fiwill see a slight increase in demand in the first quarter.
MediaTekalso launchedsatellite-based connectivitysolutions with Bullitt group, to be available in Q1 2023. MediaTek is the third player after Apple and Qualcomm to offer satellite-based connectivity solutions.
MediaTek guided the inventory levels to normalize by the end of H1 2023. This is in line with our view. In H2 2023, MediaTek expects to see growth in revenues. Currently,Chinese smartphone OEMshave 3-3.5 months of smartphone inventory levels, which will come down to 2-2.5 months by the end of Q1 2023.
According toCounterpoint Research’sSmartphone AP/SoC Shipment Tracker,MediaTek shipmentshave declined due to ongoing inventory adjustments, global macroeconomic situation, anda weak China market。LTE SoCs declined more than5G SoCsin Q4 2022.
Overall, weak guidance from MediaTek for Q1 2023. The first half of 2023 is going to be tough due to inventory correction and macroeconomic uncertainties. We forecast the market to bounce back and inventory levels to come back to normal in the second half. We expect the overall智能手机shipmentsto be flat in 2023. Therefore, despite the growth in the second half, we forecast smartphone AP SoC shipments to contract in 2023.

Premium Smartphone Shipments Grow 29% YoY in Q3 2022 in Key SEA Markets

Premium smartphone (>$400) shipments grew 29% YoY while the <$200 price band shipments fell 24%.
Overall Southeast Asia smartphone shipments dropped 10% YoY.
Apple’s iPhone shipments grew 63% YoY in Q3 2022.
5Gmade up 32% of total shipments in the key countries, 5G smartphone shipments grew 56% YoY in Q3 2022.
The $200-$400 5G smartphone band saw a 73% YoY growth.

Hong Kong, Jakarta, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – November 17, 2022

Premium智能手机(priced more than $400) shipments in the key Southeast Asian markets* increased 29% YoY in Q3 2022, according toCounterpoint Research’s Southeast Asia Monthly Smartphone Channel Share Tracker。On the other hand, total smartphone shipments declined 10% YoY during the quarter. Southeast Asia is still facingmacroeconomic headwinds。这导致了弱势企业和消费者sentiments. Investments have slowed down too, including FDI volumes for some countries. All this has led to key smartphone OEMs collecting more than the required inventory before Q4 2022. The massive YoY increase inpremium智能手机shipments reflects the resilience of this segment’s customers during difficult times.

Source: Counterpoint Research Southeast Asia Monthly Smartphone Channel Share Tracker, November 2022

September was supposed to see an increase in shipments across the region. But in 2022, this seasonal behaviour has been limited due to consistently low consumer sentiment. The lower economic strata are reeling under economic uncertainty, which shows in lower shipments and higher inventories overall. The Q4 festive season is expected to bring some relief.

There were some brand-level hits and misses too in Q3 2022. While Samsung shipments fell 13% YoY,Apple’sshipments were up 63% YoY across all the key countries.Vietnamseemed to be grabbing iPhones at a faster rate than its neighbours.

5G智能手机demand has seen slow progress in some countries likeIndonesiaandVietnamwhile it is much faster inThailandand Philippines, where the network is better and a large number of consumers are quite tech-savvy.Operatorsare still giving good package value to consumers even as it affects margins.

Specifications like processor, RAM, internal storage, battery capacity and charging speed remain a priority. Even if consumers in Indonesia and Vietnam do not actively consider5Gas a purchase factor, they tend to count it as a feature needed for the future.

Operators like Globe in thePhilippinesare keen on expanding their 5G infrastructure beyond the metro areas, whereas in Indonesia, 5G use cases have started showing for industries like mining. The $200-$400 5G smartphone price band saw a 73% YoY growth, which means that 5G is being made a staple feature by most OEMs.

Source: Counterpoint Research Southeast Asia Monthly Smartphone Channel Share Tracker, November 2022

经济评论,Senior Analyst Glen Cardozasaid, “Most Southeast Asian countries like Indonesia, Thailand and Philippines raised interest rates in Q3 2022 to ease the blow of rising prices on the common consumer.Inflationduring the quarter was an average 5% in most SEA countries, which is not alarming but did take its toll on consumers. Prices for fuel, overall logistics and staple items went up, causing consumers to hold on to their wallets and defer big expenses like smartphones. The majority of such consumers are blue-collar workers or from economically weaker sections. While a country likeThailandis struggling to regain pre-COVIDvolumes due to depleted tourism levels, Vietnam has shown a 13% GDP growth in Q3. The effect of the same is reflected in the smartphone shipments in the last few months.”

OEMs still have more than the required inventory of older models which they might try to sell using all possible marketing tools acrossofflineandonlinechannels. New models launched since August will continue to fill the market with mostly5Gdevices. Offline retail players are likely to propagate experiential outlets, increased payment convenience, trade-in offers and better after-sales support. Models likeSamsung’sGalaxy A04s andvivo’sY02s might lead the charge in increasing low-range smartphone shipments again. This is necessary for the market to portray normalcy.

* Key Southeast Asia countries include Indonesia Thailand Philippines and Vietnam

Feel free to contact us atpress@www.arena-ruc.comfor questions regarding our latest research and insights.

Background

Analyst Contacts

Glen Cardoza

遵循对比研究

MediaTek Weather’s Macroeconomic Headwinds With 9% YoY Revenue Growth

MediaTek‘s revenues fell 8.7% sequentially but increased 8.5% YoY to NT$142.1 billion. On a USD basis, revenues were comparatively flat due to FX weakness. Globalmacro headwinds, inventory correction, slowChina market and weak consumer demand led to the revenue decline and weak outlook. Declining 8% QoQ, the智能手机segment contributed to 55% (NT$ 78.2 in Q3 2022) of MediaTek’s total revenue in Q3 2022. Smartphone segment demand was affected by customers’ inventory adjustments, especially in the 5G mid-range SoCs. Demand forLTE SoCswas strong in QoQ terms.

The company has expanded its portfolio for theflagshipand mid-range segments by launchingDimensity 9000+ and Dimensity 1050, respectively. The newly launched premium SoC has been adopted by top-end gaming smartphones. Also, MediaTek will launch a next-generation flagship SoC in Q4 2022. This will add to its premium segment revenue.
The Smart Edge segment, which contributed 38% to the company’s revenue in the third quarter, declined 9% QoQ as telecommunication operators cut back on orders, negatively impacting the company’sWi-Fiand wired businesses. Also, the consumer market weakness affected the tablet, Chromebook and monitor businesses.
The power IC segment, which accounted for 7% of MediaTek’s revenue in Q3 2022, declined 17% QoQ due to weak demand for power ICs in consumer devices such as smartphones and PCs. But demand for power ICs for automotive and industrial applications remained robust in Q3 2022.
MediaTek guided Q4 2022 revenues in the range of NT$108 billion to NT$119.4 billion ($3.4 billion to $3.8 billion), a decline of 16%-24% QoQ and a decline of 7%-16% YoY. The gross margin is expected to be around 48.5% and the operating expense ratio is expected to be 31%. LTE SoCs will decline more severely than 5G SOCs in Q4 2022. Wi-Fi, broadband and routers will also be impacted as some of the Wi-Fi operators will slow down their fourth-quarter buy-in. The company also projected a sequential increase in revenues in Q1 2023.
The inventory level came down in Q3 2022 compared to the previous quarter. For both 4G and5G, SoC inventory will come down in Q4 2022. Inventory corrections will be normalized in H1 2023.
According to Counterpoint Research’sSmartphone AP/SoC Shipment Tracker, MediaTek dominated the smartphone AP/SoC market in Q3 2022 with a share of 36.5%, followed byQualcomm。MediaTek shipments have declined due to order cuts from major Chinese OEMs. MediaTek’s relatively greater dependence on the mid-end and low-end smartphone segments, which are likely to be more affected by the current macroeconomic situation as well as excess channel inventory, will lead to a weaker fourth quarter.

Overall, weak market outlook for Q4 2022 from MediaTek echoes increasingly cautious views from the foundry and IC packaging makers, which are seeing a slowdown in smartphone IC orders in early 2023. We expect 2023 to be challenging with inventory correction going on till H1 2023 and coming down to a normal level (80-90 days) by the end of 2023. The demand outlook for 2023 also looks challenging after inventory corrections due to macroeconomic uncertainty and weak China market. From the technology migration point of view, 5G SoCs are going to be a growth opportunity for the company. MediaTek will focus on maintaining gross margin, following price discipline at a time of uncertainty in the globalsemiconductor industry。

High-end Smartphones in Colombia: Q2 2022 Overview

Colombia is not a target market for flagship andpremium smartphonesconsidering its characteristics. The wholesale price segment of >$500 (or >2,217.920 million Colombian Pesos*), which typically has devices with a NAND capacity higher than 64 gigabytes, RAM capacity higher than 2 gigabytes, and 4G and 5G connectivity, represented 4.4% of the sales during Q2 2022, significantly higher than the 2.2% share in Q1 2022. This means that despite the seasonality effect, more Colombian customers bought high-end smartphones. This blog discusses the leading brands’ flagship models on offer in Colombia. The open channel here is any technology retail store, and the operator channel is any operator store.

Source: Counterpoint Market Monitor

Apple

The American brand shines with everynew model launched;iPhone 13系列也不例外。的sell-out price for these models starts at $1,950 (8,651.960 million Colombian Pesos*) for the Pro version. All iPhone models are available in the country. Apple suffered in the second quarter due to a local court’s preliminary order that bans the import and sale of all 5G devices that infringe on Ericsson’s 5G patent.

Samsung

The South Korean brand has a broad high-end portfolio with the Galaxy S22 series and Z foldable series. The open channel and proprietary brick-and-mortar stores present a wider variety of models, while the operators are more constrained. Only Movistar from Telefonica sells all the above-mentioned series’ models. Sell-out prices range from $834 (3,699.900 million Colombian Pesos*) to almost $1,386 (6,149.900 million Colombian Pesos*).

Xiaomi

The Chinese brand has different models in the price segment. On any channel, one will find three model families — Xiaomi 11T, Xiaomi 11T Pro and the new Xiaomi 12. The only difference among channels is in the open market. One can find the POCO sub-brand only in the open market. Prices for Xiaomi’s phones in the segment range between $541 (2,399.000 million Colombian Pesos*) and $902 (3,999.000 million Colombian Pesos*).

Motorola

The smallest portfolio for the segment is from Motorola. A few models are available in the Moto Edge series. However, this brand enjoys an advantage over its competitors because the new Moto Edge 30 Pro is promoted everywhere as part of a bundle withMoto Buds, which is a unique strategy in this price segment. The open market and mobile operators follow similar pricing and marketing strategies, which is also not common. Sell-out prices are $676 (2,999.900 million Colombian Pesos*) for the Edge 20 Pro and almost $744 (3,299.900 million Colombian Pesos*) for the new Moto Edge 30 Pro.

Current macroeconomic indicators like inflation and currency depreciation point to a smaller share of this price segment going forward. At the same time, other brands might enter the market and drive-up competition, bringing price benefits to the customers along with an expanded portfolio of options.

*Exchange rates may cause prices to vary

50MP Image Sensors to Retain Growth Momentum in 2022

Beijing, Boston,San Diego, Buenos Aires, London, New Delhi, Hong Kong, Seoul – April 6, 2022

Huawei’s P40 series was the first to use 50MPimage sensorsin premium smartphone design in March 2020. Other OEMs, includingvivoandOPPO, quickly caught up and launched premium phones featuring 50MP sensors. By the second half of 2021, when Samsung’s 0.64µm 50MP S5KJN1 entered mass production, 50MP sensors had become a hot item. The sales share of smartphones featuring a 50MP rear primary camera jumped to 5.6% in Q4 2021 from 1.7% in Q2 2021.

Smartphone 50MP Rear Primary Camera Penetration by Sales

Now, large-pixel 50MP (1.0µm and above) sensors have started to penetrate the mid-to-high-end market due to price cuts. In February 2020,Sony后,发布了自定义50议员IMX700华为which Samsung and OmniVision also launched their 50MP sensors. This led the price of large-pixel 50MP sensors to record a high double-digit drop compared to Q2 2020. As a result, more and more mid-range models, such as therealmeGT Master Explorer Edition, started adopting big-pixel 50MP sensors, pushing up the share of 50MP in the $400-$599 segment to 11.7% in Q4 2021 from 4.2% in Q2 2021.

Smartphone 50MP Rear Primary Camera Penetration by Price Band, Q4 2021

Samsungunveiled its small-pixel 50MP S5KJN1 (0.64µm) in June 2021, further bringing the price down to under $5. This convinced OEMs such as vivo, OPPO and Xiaomi to actively deploy the S5KJN1 in their low-to-mid-end models. As a result, the proportion of smartphones with a 50MP rear main camera in the $200-$399 and < $200 segments surged to 3.6% and 6.1% respectively in Q4 2021.

Additionally, there is an emerging trend of OEMs strengthening theultrawide cameraperformance by increasing the resolution to 50MP to deliver superior landscape shooting.

Looking into 2022,SK hynixand SmartSens are expected to start mass production of their 50MP image sensors during the year, which will intensify competition and bring prices down. Therefore, we expect stronger demand for 50MP image sensors, with sub-0.7µm offerings accounting for more than three-quarters of total sales.

Background

Analyst Contacts:

Alicia Gong

Ethan Qi

遵循对比研究
press(at)www.arena-ruc.com

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Insights Tag:Premium Smartphone

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