Are the Chinese Seeing a Slowdown in Smartphone Growth?
July 3, 2017

China's top-3 smartphone vendors, Huawei, Oppo and Vivo, have quietly lowered their smartphone shipments goals set for 2017 due to difficulties ramping up shipments significantly in non-China markets, according to sources from Taiwan-based IC design houses. While Huawei has quickly worked its way to capture third-place in the global smartphone market, trailing only Samsung Electronics and Apple, it has made little headway in the US so far, indicated the sources.
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Due to its low presence in the US market, Huawei is currently facing stagnant growth in its smartphone shipments, said the sources.  Huawei is expected to ship 30 million smartphones in the second quarter of 2017 compared to 32 million units shipped during the same period a year earlier, according to a recent Korea-based Business Postreport. IDC reported earlier that Huawei shipped 34.2 million smartphones in the first quarter of 2017, up 21.7% from a year earlier. Huawei shipped 139 million smartphones in 2016. While Oppo and Vivo have been trying to duplicate their successful strategies implemented in China by setting up large-scale retail chains in overseas markets, the effectiveness of such efforts, which require time and a large amount of capital, still remains to be seen, commented the sources. Oppo and Vivo both previously set high-end targets of shipping 150 million smartphones in 2017, after shipping 99.4 million and 77.3 million, respectively, in 2016.
In contrast to these reports that Chinese smartphone OEMs are reducing their 2017 forecasts, China-based smartphone vendors including Oppo and Vivo have stepped up their pace of chip orders, while Huawei, Xiaomi Technology and Gionee are also expected to increase their chip orders substantially by the middle of the third quarter, according to industry sources. The latest round of pull-in orders from China-based smartphone vendors, notably Oppo, indicates that the recent adjustments of inventory levels of smartphone parts and components in China have come to an end. Judging from the order visibility of individual vendors, Oppo, Vivo and Huawei are apparently the frontrunners in the race for inventory build-ups, which in turn may allow them to continue maintaining their market positions in China, commented the sources. Taiwan-based IC vendors for wireless chips, LCD driver ICs, touch controllers, analog chips and fingerprint sensors are thus expected to brace for brisk sales in the third quarter, said the sources.

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