China’s smartphone market fell to a decade low in 2022

According to the International Data Corporation's (IDC) Worldwide Quarterly Mobile Phone Tracker, China's smartphone market fell below the 300 million units level for the first time in ten years.

The IDC says that 285.8 million smartphones were shipped in 2022, a 13.2% year-on-year (YoY) decrease. Looking specifically at Q4 of 2022, the market declined 12.6% YoY to just 72.9 million units.

This drop in the market can be attributed partly to China's strict COVID-19 response, which has been completed primarily through strict lockdowns, encouraging an economic slowdown and discouraging demand.

IDC says that the full-year market size neared the level ten years ago when two out of five mobile phone shipments were still feature phones.

In breaking down how the top manufacturers performed, Vivo retained its position as the market leader. However, its market share dropped from 21.5% in 2021 to 18.6% in 2022, a -25.1% YoY growth.

In the biggest surprise, Honor has shot up the rankings. In 2021 Honor had an 11.7% market share, the lowest of the leading five manufacturers that IDC provided. Yet in 2022, Honor's market share has increased to 18.1%, a 34.4% YoY growth, which is surprising given the turbulent economic conditions.

The company with the largest drop in YoY growth was OPPO. With a 20.4% market share in 2021, the company retained only a 16.8% market share in 2022, a -28.2% YoY growth.

Apple also recorded a 16.8% market share in 2022, a -4.4% YoY growth from its 15.3% market share in 2021. This comes after, in Q4 2022, Apple's iPhone assembly facility in Zhengzhou returned to its normal pace in December despite the COVID-induced disruptions in the prior month.

The company with the fifth highest market share was Xiaomi. They recorded a 13.7% share of the market, a -23.7% YoY growth from its 15.5% market share in 2021.

As for all the other smartphone manufacturers, their market share grew from 15.6% in 2021 to 16.0% in 2022. However, they still had a -11.2% YoY growth.

"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," says Will Wong, Senior Research Manager for Client Devices, IDC Asia/Pacific.

"On the positive side, the end of the zero-COVID policy provides a tailwind to the market, though a quick rebound is unlikely as consumers spend on areas like leisure and services instead."

When looking specifically at YoY growth in Q4 of 2022, there are similar trends that can be seen in China's smartphone market. However, the top three manufacturers saw a larger or similar market share in Q4 2022 than in Q4 2021.

Apple had the largest market share in Q4 2022, with 20.6%, the same as its Q4 market share in 2021. However, it still had a -12.7 YoY growth.

Vivo had the second-largest Q4 2022 market share with 17.5%, an increase from its 16.8% market share in Q4 2021. However, it still recorded a -9.0 YoY growth.

Honor came in third with a 17.1% Q4 2022 market share, up from its 17.0% market share in Q4 2021. However, it also recorded a drop with a -12.0 YoY growth. 

OPPO had a 15.6% market share in Q4 2022, compared to its 16.6% market share in Q4 2021, a -18.0% YoY growth.

Xiaomi continued its poor performance in Q4 2022, dropping from its 15.8% market share in Q4 2021 to just 11.8%, a substantial -35.5% YoY growth.

One surprising positive could be found in the other smartphone manufacturers, who had a positive Q4. Their market share grew from 13.2% in Q4 2021 to 17.6% in Q4 2022, a 16.2% YoY growth.

Overall, Honor was the only Top 5 player that achieved growth in 2022 due to a low comparison base year and its aggressive product portfolio development.