China smartphone shipments fall for fifth straight quarter as costs rise

BEIJING — China's smartphone shipments fell 4.3 per cent to 66 million units in the second quarter from a year earlier, as many manufacturers hiked prices to reflect rising memory and component costs, research firm IDC said on Tuesday (July 14).

It was the fifth straight quarterly decline, and first-half shipments were down 4.2 per cent from a year earlier.

Huawei Technologies and Apple were the only vendors to post growth in the quarter, with shipments up 19.4 per cent and 24.4 per cent, respectively.

"Huawei and Apple held their prices steady while competitors were raising theirs, and that gave hesitant buyers a reason to go ahead and purchase in a quarter when most of the market was giving them a reason to wait," said Arthur Guo, a senior analyst at IDC China.

Huawei ranked first with a 22.6 per cent market share, while Apple came second with an 18.1 per cent share. Xiaomi, which ranked fifth, saw its second-quarter shipments down 21.7 per cent, with Oppo and Vivo seeing shipments fall 9.7 per cent and 11.4 per cent, respectively.

Most Android vendors raised prices or cut back on budget models in response to surging memory chips and other component costs, discouraging consumers from upgrading. 

The fading effect of government subsidies also removed a prop that had supported demand in earlier quarters, IDC said.

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