Mobile Phone Market in 2020: Samsung Becomes The Biggest Loser

 

This year, compared with the previous year, shipments of smartphones from multiple brands across the world have fallen. Among them, Samsung temporarily ranked first with a decline of 35 million units, rather than Huawei, which may face insufficient chip supply, which surprised the market. The big reason for the dismal performance of Samsung is that since this year, Samsung has not relaxed its channels, but tightened its channels globally, squeezing its profits. According to analysis, Samsung's move is to believe that Huawei, as its strong competitor, has withdrawn from some markets and wants to obtain more profits from the channel.

But the problem is that although Huawei has spit out some markets, manufacturers such as Xiaomi , OPPO , and vivo have entered strongly, causing these manufacturers to become more favored partners of some channels. Therefore, Samsung missed the trend of Huawei's decline. Another reason is that Samsung re-sold offline, but offline sales basically stagnated during the epidemic. Canalys, a global technology market analysis and market consulting company, released a report that in the second quarter of 2020, Samsung, which has consistently ranked first in the global smartphone market for eight consecutive years, fell to second. Samsung’s smartphone shipments in the quarter were 53.7 million units, a 30% year-on-year decrease from the second quarter of 2019.

The financial report also showed that Samsung Electronics’ second-quarter revenue was 52.97 trillion won (about 320 billion yuan), a decrease of 5.63% from 56.13 trillion won in the same period last year. In terms of corporate development, the financial report for the second quarter of 2020 shows that most of Samsung's operating profit is contributed by the chip department, accounting for approximately 66.63% of the total profit. It can be seen that chip products have become Samsung's revenue pillar despite the overall downturn in the mobile phone market. Although the decline in Huawei's production has brought other mobile phone manufacturers more market share, due to Huawei's huge demand for chips, according to Reuters reports, some analysts believe that the entire chip industry may face a large inventory backlog. With the poor performance of the mobile phone market and the lack of optimism for its pillar chip products, Samsung’s future business focus is worthy of attention. In terms of industry, according to data from Counterpoint Research, affected by the epidemic, global smartphone shipments plummeted by 23% in the second quarter of 2020, which is also the largest drop in history. Overall, the smartphone industry revenue in the second quarter fell by 15% year-on-year.

In such a downturn in the mobile phone market, Samsung is not very competitive when competing for the market share vacated by Huawei. As a result, Samsung has performed poorly in various markets around the world, and the entire market is being reshuffled. In Greater China, shipments in the second quarter fell 8% year-on-year. Huawei, Apple are the two best-performing manufacturers. From the perspective of 5G, Huawei has accounted for 63%, and Xiaomi has also reached 56%. OPPO36%, VIVO35%, Samsung 25%, Samsung was left behind. The overall European market has decreased to a certain extent. From the perspective of manufacturer share, Samsung 41% last year, this year dropped to 30%; Apple last year 14%, this year rose to 21%; Xiaomi last year 10%, this year increased to 17%, the top three manufacturers have already appeared structural change. Samsung fell horribly (11%), but Apple and Xiaomi rose sharply. In the Asia-Pacific countries, the top competitors have changed a lot. Samsung is the first, but from last year to this year, Samsung's share has decreased from 24% to 21%. The entire competition is fierce, and Samsung is slowly losing its share in the market where it originally had an advantage.

However, Samsung also faces some opportunities. Counterpoint Research said that the current competitive landscape in the mobile phone industry presents good opportunities for other (non-Apple, Huawei) brands. The company’s analyst KangMin-soo said: “For Samsung, this will be a good opportunity to increase its smartphone market share, especially in Europe, where the company has been fiercely competing with Huawei in different price points. ." Huawei's volume in the first three weeks of September has already begun to fall, and even in some projects, Huawei's domestic shipments have fallen by 10%. Huawei occupies 50% of the high-end market, and this 50% may be almost the same next year. Who can get more consumers in different areas is the winner. As a result of the epidemic, high-end mobile phones in major high-end markets such as North America and Europe have decreased to a certain extent. Except for Apple and Huawei, other high-selling mobile phones are mid-to-low-end mobile phones, which also reflects the overall market demand of consumers who are biased and concentrated in the low-end market.

we have seen that Samsung has made new adjustments in its products, such as M21, M31, A01Core, and mobile phones sold for $70 or $80 have appeared on the market. On the whole, Samsung may have a good recovery in the third quarter. A buyer analyst who has been tracking the consumer electronics industry chain for a long time believes that in the past year, mobile phone manufacturers such as Xiaomi and OPPO have demonstrated strong product change capabilities, and Huawei has further deepened its influence in the hearts of Chinese people to some extent. Taken together, the "Chinese Legion" has become the winner, and it is not surprising that Samsung's market share has been squeezed.