Key facts
- China's smartphone sales declined 13% year-on-year during the 618 shopping festival.
- Higher memory costs due to AI infrastructure build-out increased handset costs.
- Brands offered fewer and less aggressive discounts compared to the previous year.
- Huawei was the only major brand to achieve year-on-year sales growth, increasing by 19%.
- Apple's sales decreased by 9%, though it secured the second market position.
- The 618 festival boosted June sales, but a seasonal slowdown is anticipated.
Smartphone sales in China experienced a 13% year-on-year decline during the recent 618 shopping festival, a period typically seen as a key indicator for the country's e-commerce sector. According to Counterpoint Research, this downturn was largely attributed to increased memory costs, driven by the rapid expansion of AI infrastructure, which consequently pushed up handset prices and limited brands' ability to offer substantial discounts.
Brands like Honor and Xiaomi saw significant drops in sales, with Honor sales falling by 33% and Xiaomi's by 24%. In contrast, Huawei Technologies was the sole major brand to record year-on-year growth, with a 19% increase in sales and capturing a 21% market share. Apple's sales also declined by 9%, despite efforts to incentivize purchases, falling short of the previous year's promotional effectiveness.
Analysts noted that discounts during this year's 618 festival were less aggressive in both scope and depth compared to prior years. While the festival provided a monthly sales recovery for June, Counterpoint Research anticipates a seasonal slowdown and a double-digit decline in overall smartphone shipments for the year.