Analysis of China’s Smartphone Market in February 2024
Recently, the China Academy of Information and Communications Technology (CAICT) released a report analyzing the performance of the domestic smartphone market in February 2024.
The data indicates that in February, the total shipment of mobile phones in the domestic market was 14.257 million units, a year-on-year decrease of 32.9%. Among them, smartphone shipments accounted for 14.042 million units, making up 98.5% of the total and dropping by 31.3% year-on-year. Additionally, 5G smartphones reached 12.532 million units, declining by 29.2% compared to the same period last year and constituting 87.9% of the total mobile phone shipments.
It is evident that the current market is predominantly filled with 5G smartphones, with smartphones accounting for 98.5% of the market and 5G smartphones occupying around 88%.
Although the year-on-year decline is not particularly significant, only around 30%, the situation worsens when considering the month-on-month comparison.
Following CAICT’s data, in January 2024, the total mobile phone shipments in China were 31.778 million units, with smartphone shipments reaching 29.513 million units, and 5G smartphones amounting to 26.165 million units.
When comparing February with January, there is a substantial 55% drop in total mobile phone shipments, a 52% decline in smartphone sales, equating to a shortfall of 15.57 million units, and a 52% decrease in 5G smartphone sales, leading to 13.63 million fewer units sold.
Why such a drastic decline in February? Primarily due to the Chinese New Year holiday. With only 29 days in February and an additional 8-day holiday for the Spring Festival, business naturally slows down before and after the festivities.
Considering that roughly half of February was business days, it becomes easier to comprehend the 50% decrease in sales during this month.
Nevertheless, while these reasons are valid, comparing this February with the same month last year reveals a 30%+ decline, indicating a rather bleak outlook for smartphone sales this year.
Why are smartphones becoming increasingly challenging to sell? Multiple factors contribute to this trend. Firstly, there is a lack of significant innovation in current smartphones, leading consumers to hold onto their devices longer rather than upgrading annually.
Secondly, smartphones today have longer lifespans due to technological maturity; even budget-friendly devices offer satisfactory performance, allowing users to use them for extended periods without the need for frequent replacements.
Lastly, the overall economic situation plays a role, as smartphones are becoming more expensive, dissuading consumers from frequent upgrades and encouraging cost-saving measures.
Given these circumstances, smartphone manufacturers are likely facing immense pressure this year, especially domestic brands, considering China remains their primary market. However, to drive sales, focusing solely on the domestic market might not be sufficient anymore. Turning towards international markets may be the key to boosting sales amidst the current challenging conditions.