Counterpoint Research: In Q1, Apple grew 32% YoY in China due to strong iPhone X performance

According to the latest research from Counterpoint’s Market Monitor service, Chinese smartphone shipments slowed in Q1 2018 with YoY decline of 8% and sequential decline of 21%. The top five brands captured a record 82% of the market with other OEMs struggling to grow.

Commenting on the overall market, James Yan, Research Director at Counterpoint Research said in a statement, “2018 started on a slower note for the world’s largest smartphone market. The slowdown can be attributed to lengthening smartphone replacement cycle for the Chinese consumers. Additionally, lack of product launches in Q1 2018 with OEMs focusing on inventory clearance, especially for non-bezel-less display devices, were other key factors impacting shipment volumes. Bezel-less devices are now popular in China and more OEMs are expected to launch sub-1000 RMB (~US$160) bezel-less portfolio to differentiate their offerings in the mid segment.”

Exhibit 1: China Smartphone Market Share Q1 2018

China Smartphone Market Share Q1 2018
Source: Counterpoint Research Market Monitor Q1 2018

Huawei continues to lead the Chinese smartphone market with 22% market share followed by OPPO and vivo with 18% and 16% share respectively. However, Xiaomi (+51%) and Apple (+32%) were the fastest growing brands among the top five.

Commenting on the OEM performance, Mr. Yan added, “Huawei’s Honor continues to do well in in China with almost 2/3rd of Honor sales coming from online channels. Additionally, the brand also carried out heavy promotions for its Nova series during the quarter, which drove volume. OPPO and vivo were the second and third largest brands in China in Q1 2018, capturing a combined one third of the smartphone market. However, during Q1 2018, we saw that OPPO and vivo’s growth slowed considerably, due to lack of a portfolio refresh. Both vivo and OPPO refreshed their portfolio towards the end of Q1, adding some new features that included an under the display fingerprint sensor and notch display. With initial demand for their refreshed X and R series going well, we expect both brands to improve in the coming quarters.”

Mr. Yan further commented, “Xiaomi was the fastest growing brand in China during the quarter. The growth was driven by Xiaomi’s expansion in the offline segment with aggressive promotions. It also refreshed its Redmi Note series and now has a very strong product portfolio in the mid segment, giving more choice to budget-conscious consumers. Apple grew 32% YoY in China due to strong performance of its iPhone X. While the promotions were not aggressive for the iPhone X, except in operator channels, its demand remains healthy in the market.”

Commenting on product launches during the quarter, Research Analyst MengMeng Zhang, noted, “One of the key highlights during the quarter was the launch of notch display devices. By the end of Q1 2018 four out of the top five smartphone OEMs had already launched their devices with notch displays in China. This has given early adopters an edge over competitors to differentiate in terms of product design. Going forward, we expect notch display devices to penetrate from the 3000 RMB (~US$475) segment that they are currently in, to sub 2000 RMB (~US$315) segment in the coming quarters. Apart from this, under the display finger print devices are likely to pick up too, with vivo already launching the feature in the X20 and X21 series.”

Commenting on Apple’s performance and opportunity, Associate Director, Tarun Pathak, highlighted, “Apple still holds a large user base in China who haven’t upgraded in the past two years. Apple is now back to YoY growth in the first quarter since Q1 2015, which is an indication that its older generation iPhone user base is now upgrading. This can set the set the tone for the vendor’s full year outlook. Furthermore, as Apple enters its seasonal cycle, promotions in the coming quarters will further drive upgrades.”

Source: Counterpoint Technology Market Research

MacDailyNews Take: You know, because iPhone X is doomed.

Apple iPhone X supplier Samsung warns of weak display panel demand – April 26, 2018
How many iPhones did Apple sell last quarter? – April 25, 2018
Apple’s iPhone X isn’t selling well – or is it? – April 21, 2018
Morgan Stanley: Apple stock may fall on ‘materially’ weaker iPhone sales – April 20, 2018
Apple’s iPhone captured 86% of global handset profits in Q417; iPhone X alone took 35% of global handset profits – April 17, 2018
Apple’s iPhone X is the UK’s most popular smartphone – April 9, 2018
Apple to release Q218 earnings, webcast live conference call on May 1st – April 3, 2018


  1. Apple is certainly getting creamed in terms of market share percentage which brings about all the doom and gloom stories. I suppose there’s nothing that can be done about it in a totally saturated smartphone market. I blame Apple for not looking elsewhere for revenue to offset iPhone sales losses. It’s just far too easy to tank Apple’s share price with “iPhone weakness” articles.

    I can only hope a lot of these articles are merely “fake news” articles. I just know these iPhone research articles are going to be a daily thing right up to Apple’s quarterly report. I have to wonder why Apple is such an easy target despite having such a low P/E and plenty of cash to spend.

  2. Now Bernstein analcyst is manipulating the stock with regurgitade news and hammering is yet again…
    Unbelievable how easy it is to manipulate Apple investors..

    That said , i wish apple PR would get a better handle on Apples narrative and stir excitement both in investors community and the market and bring a bit more stability to the stock.

    There is almost zero exciting news regarding Apple and their road map… .. Apple is way too opeque if u ask me… the secrecy motto is way overplayed.

    Come on Apple
    Get those PR gears spining and excite the market with great things to come…. that does not mean u have to reveal every single future product… but rather an exciting, tantalizing roadmap and narrative.

    Steve used to hold the power of ‘the benefit of the doubt’ for Apple… …. that was the charisma and power he had.
    Without it Apple needs to resort to other PR forces to compensate, yet they don’t seem to realize that.
    Too much silence. Imo

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.