Honor Records Growth Amid Decade-Low China Smartphone Shipments in 2022

Only one major smartphone brand managed to record growth amid China's historically low shipments in 2022 – Honor.

Credit: TechSpot

According to the International Data Corporation (IDC), the former Huawei Technologies Co. sub-brand saw shipments grow 34.4% year-over-year in 2022, while competitors like Vivo and Oppo both slumped by more than 25%. The IDC attributes Honor's growth to a low comparison base year and its aggressive product portfolio development.

Apple and Xiaomi, which round out the top five smartphone brands in China, were similarly down in 2022 compared to the year prior. However, Apple did manage to maintain a seasonal quarter-on-quarter growth, with the iPhone assembly facility in Zhengzhou returning to normal production operations and a boost in sales during the Singles’ Day online shopping festival.

Huawei sold Honor to a state-backed consortium in 2020 in a bid to keep part of its smartphone unit alive as the U.S. levelled sanctions against it. The spinoff brand last year tried to secure expansion capital ahead of a potential initial public offering.

China shipped 285.8 million smartphones in 2022, the first time shipments fell below 300 million in a decade. The number is down 13.2% compared to last year.

“The historically low shipments raise an alarm bell for smartphone vendors to rethink how to build a more sustainable business model and a more targeted marketing strategy,” said Will Wong, Senior Research Manager for Client Devices at IDC Asia.

Credit: Reuters

The IDC said the strict quarantine measures which kept consumers out of the streets and the slowing economy were among the primary factors that led to the slump in smartphone shipments. But with the country now relaxing restrictions, the market has a chance to bounce back, though the IDC believes it would take some time, with the majority of consumers prioritising spending on leisure and services over consumer electronics.

The relatively low smartphone shipments in 2022 have also hit major chipmakers like Samsung. The chip downturn has reportedly started eating away at the South Korean tech giant's profits. But instead of slowing down, it's keeping capital spending at the same level as last year at about US$39 billion, as Bloomberg reported.

The move would put more pressure on its smaller rivals who have decided to cut back spending in 2023 at the expense of profitability. As to how it'll play out for Samsung remains to be seen. The company does expect the chip market to recover within the second half of the year, though it doesn't expect the same for the smartphone market.

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• Only one major smartphone brand managed to record growth amid China's historically low shipments in 2022 – Honor.

• The former Huawei Technologies Co. sub-brand saw shipments grow 34.4% year-over-year in 2022, while competitors like Vivo and Oppo both slumped by more than 25%.

• China shipped 285.8 million smartphones in 2022, the first time shipments fell below 300 million in a decade.

• The strict quarantine measures which kept consumers out of the streets and the slowing economy were among the primary factors that led to the slump in smartphone shipments.