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Latin America Smartphones Still Feeling Supply Constraint Headwinds

  • LATAM smartphone shipments decreased 5.8% YoY in Q1 2022.
  • Samsung led the market with 44.3% share followed by Motorola with 17.1% share.

Buenos Aires, New Delhi, Hong Kong, Seoul, London, Beijing, San Diego – June 8, 2022

Q1 2022 smartphone shipments dropped 5.8% YoY, affected by supply constraints, mainly among the Chinese brands. Also, last year’s first quarter sell-in was especially high making year on year comparisons tough. The supply issues are improving but might continue to be a drag for the rest of the year.

Commenting on the market dynamics, Principal Analyst Tina Lu said: “During Q1 2022, OEMs in LATAM (includes the Caribbean and Latin America) were in a fierce price war, which mitigated the impact of consumer demand that started to contract, but it might not be the same moving forward, especially in the mid-high price band segment smartphones. 5G devices volume and penetration continue to grow; in Q1 2022, 5G devices represented 15% of the smartphones sold in the region. Brazil, Mexico and Chile lead 5G-enabled sales volume and penetration share. Samsung overtook Apple to become the leading vendor in 5G-enabled device sales.”

Top Smartphone OEMs’ Market Share in Latin America, Q1 2021 vs Q1 2022

Source: Counterpoint Research Q1 2022 Market Monitor

 

Lu added: “Chinese brands might not yet have the power to drive growth. Samsung increased its share in the region and continued leading the LATAM market, driven by Brazil and shipments of the Galaxy A 03 model family. Motorola’s shipment decline was caused by the Chinese New Year and other supply chain disruptions. This impacted it in most markets except for Argentina. Xiaomi decreased share slightly, impacted by supply chain issues, but it increased its ASP.”

Market Growth in Latin America Biggest Countries, Q1 2022

Source: Counterpoint Research Q1 2022 Market Monitor

Commenting on country performance, Research Analyst Andres Silva, said: “Most of LATAM’s biggest countries followed the regional trend of YoY declines, except for Chile, which slightly improved. Chile is one of the most stable countries in the region. Mexico was flat YoY, fueled by Chinese brands entering the market and increased competition. Samsung is also resolving its issues with Telcel. Brazilian local manufacturing/assembly improved, but it is still impacted by component supply chain shortages.”

Q1 2022 Market Summary

  • Samsung retained leadership in all LATAM markets.
  • Samsung’s volumes declined YoY and QoQ, impacted by the decline in shipments from its Vietnam factory. But sell-in volume still outpaced most Chinese brands, so its share increased YoY and QoQ. Telcel Mexico’s issue with Samsung is slowly settling. Samsung did not have enough supply in the entry-level segment, so it saw a slight YoY decrease in its sales volume in this segment, particularly in Brazil and Mexico.
  • Motorola’s shipments dropped YoY and QoQ. Its sales declined following a lack of supply due to the Lunar New Year break in China and inventory issues.
  • Xiaomi continued to grow YoY, though it dropped compared to the previous quarter. It is strengthening its position in the region. But most of its volume is based on the Xiaomi Redmi Note series. It will need to become more aggressive with its entry-level A series to continue to grow in LATAM. Xiaomi is offering aggressive pricing and promotions, but still lacks strong brand recognition. The brand is facing some high inventory issues in its mid-high price segment models.
  • In Q1 2022, Xiaomi officially entered the Argentina market, but did not immediately make much headway achieving only 1% market share through April 2022.
  • Since the beginning of 2022, Apple’s supply into the region increased YoY in most of its markets resulting in the brand’s share increasing. Apple is expensive for the region’s average consumer but is considered a desirable brand. So, countries with high ASPs, such as Chile and, to a lesser extent, Brazil, account for most of its volume in the region.
  • ZTE continued to be the principal provider of entry-level devices with most of its sales coming from <$100 models.
  • Others brands continued to drop YoY as the Chinese new year and component shortages impact smaller Chinese brands and local brands, especially in the entry-level segment.

 

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It serves major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

 

Analyst Contacts:

Tina Lu

+54 91160411221
tina@counterpointresearch.com

Andres Silva

+57 3004929435

andres.silva@counterpointresearch.com

Peter Richardson

+44 7917231934
Peter@counterpointresearch.com

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Counterpoint research is a young and fast growing research firm covering analysis of the tech industry. Coverage areas are connected devices, digital consumer goods, software & applications and other adjacent topics. We provide syndicated research reports as well as tailored. Our seminars and workshops for companies and institutions are popular and available on demand. Consulting and customized work on the above topics is provided for high precision projects.

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