The global semiconductor components shortage has been in the news since the start of the COVID-19 pandemic. Trade tensions between the US and China further upset the normal supply situation and the automotive sector was among the high-profile casualties. Chip manufacturers addressed the supply-demand issue by increasing capacity.
Then, there is the Russia-Ukraine conflict which has added further uncertainties with respect to some raw materials that are required for semiconductor manufacturing. The geopolitical issues are also creating macroeconomic headwinds, leading to a drop in overall demand. Will an increase in capacity lead to an oversupply situation?
In the latest episode of ‘The Counterpoint Podcast’, host Peter Richardson is joined by Research Director Dale Gai, and Senior Analyst Ashwath Rao to talk about the global semiconductor manufacturing and foundry market update. In this discussion, we talk about the foundry inventory correction cycle, the role of wafer fab equipment makers in the supply chain, the future of process node and packaging technologies, and much more.
ASML has delivered a strong Q2 2022 ahead of its guidance with record quarterly orders. Net sales increased by 35% YoY to €5.4 billion driven by increased EUV shipments, which accounted for 48% of the net systems sales during the quarter.
However, the company outlook for 2022 has been lowered to around 10% YoY growth on account of deferred revenue recognition due to the adoption of a fast shipment strategy. Challenges will persist in the near term amid supply chain constraints and inflationary pressures. But strong demand in high-performance computing (HPC), automotive and IoT will enhance ASML’s growth prospects in the long term.
Q2 2022 KPIs
Net sales of €5.4 billion ahead of guidance, thanks to deferred revenue recognition from six EUV systems’ fast shipments in Q1 2022.
Net systems sales at €4.1 billion, an increase of 40% YoY with EUV accounting for 48% share.
Service and field option sales at €1.3 billion.
Shipped 12 EUV systems, an increase of 33% YoY.
Gross margin of 49.1% at the lower end of the guidance due to inflationary effects.
Record quarterly net bookings of €8.5 billion. €5.4 billion in EUV orders including High-NA, thanks to customer demand in both advanced and mature nodes.
Record total order book of €33 billion at the end of the quarter – 85% for advanced semiconductor manufacturing, including High-end immersion and EUV, and 15% for mature technology needed for advanced production.
Source: ASML Earnings, Counterpoint Research Wafer Fab Equipment Tracker
Net system sales by end-use had logic taking 71% and memory taking 29%. Increased shipments to logic attributed to focus by foundries on ramping up 3nm process nodes.
Gross margin to remain under pressure in the near term due to supply chain challenges and inflationary pressure on labor, freight and parts.
High utilization rates of machines that are in the installed base will help ASML’s growth prospects despite demand slowing in the PC and smartphone markets in the near term.
ASML has started integration and initial testing of first High-NA mechanical projection optics and illuminator along with the new wafer stage received from suppliers.
On the DUV business side, it shipped the first NXT KrF system –TWINSCAN NXT:870 – with increased throughput capability, much needed for responding to the industry’s demand for KrF tools and wafer output.
In the applications business, the company completed the first eScan1100 multi-beam system installation at a customer site.
The company will revisit its medium-term forecast and guidance on growth opportunities beyond 2025 on “Capital markets day” on November 11, 2022.
Source: ASML Earnings, Counterpoint Research Wafer Fab Equipment Tracker
Taiwan took 41% and South Korea took 33% share of the equipment shipments in Q2 2022 driven by the ramping up of activities on advanced technology nodes and adoption of EUV in high-volume manufacturing by foundries to shorten ramp times, improve device performance and yield, and optimize factory output and operating costs.
Restrictions on the supply of DUV machines used in mature nodes in addition to EUV systems led to a fall in shipments to China in Q2. However, increased shipments to Taiwan and South Korea helped boost net sales.
China is a major player in the semiconductor value chain and any restriction on DUV systems’ sales, which find application in mature nodes, will affect Chinese chip makers’ expansion plans, further aggravating the component shortage crisis.
Outlook for 2022
Q3 net sales are projected to be between €5.1 billion and €5.4 billion.
Full-year revenue growth projection lowered to €20.5 billion on account of an increased number of fast shipments assuming priority due to supply chain disruptions and delaying of revenue recognition to 2023. Fast shipments reduce the cycle time by carrying out acceptance tests at the customer end to output more systems. ASML has been adopting this strategy from the beginning of 2022 to overcome issues arising out of supply chain constraints.
Gross margin to be between 49% and 50% due to extra costs related to output capacity increase and unexpected inflationary trends.
55 EUV systems to be shipped in 2022 with revenue recognition for only 40 systems in 2022 and for the remaining 15 in 2023.
Increased shipments to Taiwan and South Korea attributed to ramping up of activities on advanced technology nodes.
Foundries ramping up production of 3nm process nodes by applying Gate-All-Around transistor and FinFET architectures and using EUV technology will help ASML improve its share in the wafer fab equipment market.
Fall in shipments to China due to restrictions on the supply of DUV machines will aggravate the component shortage crisis.
The global smartphone market declined by 7% YoY and 12% QoQ to 328 million units in Q1 2022.
While Samsung’s shipments declined 3% YoY, it was the only top-five smartphone brand to grow QoQ. Its market share rose to 23% from 19% last quarter, resulting in Samsung taking the top spot from Apple in Q1 2022.
Apple’s shipments declined by 1% annually to reach 59 million units in Q1 2022. This was after an expected seasonal quarterly shipment decline of 28%.
Xiaomi, OPPO* and vivo’s component struggles continued, causing a quarterly and annual decline in their respective shipments.
New Delhi, Hong Kong, Seoul, London, Beijing, San Diego, Buenos Aires – April 29, 2022
The global smartphone market declined by 7% YoY, shipping 328 million units in Q1 2022, according to the latest research from Counterpoint’s Market Monitorservice. The decline was caused by ongoing component shortages, as well as COVID resurgence at the beginning of the quarter and the Russia-Ukraine war towards the end. The global smartphone market also, as expected, had a seasonal decline of 12% QoQ.
Commenting on the overall market dynamics, Senior Analyst Harmeet Singh Walia said, “the global smartphone market presented a mixed bag in the first quarter of 2022. Samsung seems to have overcome component shortages that affected its supply last year, as evidenced by higher-than-expected growth in its shipments despite a late flagship launch. Major Chinese OEMs such as Xiaomi, OPPO* and vivo, meanwhile, faced a greater component supply crunch, resulting in their shipments falling by 20%, 19% and 19% YoY respectively.”
Samsung shipped 74 million units in Q1 2022, down just 3% YoY, and was one of only two top-five smartphone brands to come close to its pre-pandemic Q1 shipments. While its flagships were launched towards the end of February (a month later than last year) and at a price higher than the previous S21 series (despite lower BOM costs), customers responded well, driving a 7% QoQ shipment growth.
Apple’s global smartphone shipments remained flat compared to Q1 2021 at 59 million units in Q1 2022. This was driven by strong demand for iPhone 13 series and the early launch of its first 5G-enabled SE Series which, even in a contracting market, helped push Apple’s market share to 18%, up from 17% in Q1 2021. Its quarterly shipment decline of 28% is primarily due to seasonality.
Xiaomi’s global smartphone shipments declined by 20% YoY to 39 million units in Q1 2022, with its market share falling to 12% from 14% in the same quarter last year. This was caused by the relatively weak performance of the Redmi 9A and 10S smartphones, along with chip shortages that are hurting Xiaomi more severely than other vendors. Xiaomi was also unable to benefit from the Chinese New Year shopping festival, with its share of the world’s biggest smartphone market falling to under 15% (down from over 16% both in the last quarter and in the same quarter of last year).
OPPO’s* shipments declined by 19% YoY and 9% QoQ to 31 million units in Q1 2022 due to supply-side constraints resulting from the ongoing component shortages. Being offline focused and with few new major recent launches, OPPO’s shipments were affected more acutely during the Omicron wave, especially in its key markets such as India. Consequently, its market share fell to 9% from 11% in Q1 2021.
vivo also declined by 19% YoY and 3% QoQ with its market share falling to 9% in Q1 2022 down from 10% in the same quarter last year. vivo, like OPPO, has been facing component shortages more severely since the end of last year. There has also been greater competition in the mass market which is a key driver of vivo’s shipment volumes. Therefore, despite performing well in China where it replaced Apple as the top smartphone brand, it saw a decline in global shipments.
Research Director Jan Stryjak noted, “while component shortages are expected to ease soon, the Russia-Ukraine war poses a new challenge to the recovery of the global smartphone market. In Q1 2022, the war had little impact on global smartphone shipments. Although Samsung and Apple withdrew from the Russian market in early March, the consequences are, at the moment, relatively small on a global scale. The two vendors make up around half of Russian smartphone shipments, but their combined shipments in Russia account for less than 2% of total global smartphone shipments. However, the impact of the war may develop wider ramifications if it leads to a drop in availability of raw materials, a rise in prices, further inflationary pressure and/or other vendors withdrawing from Russia.”
Other Key Trends:
HONOR’s shipments grew by 148% YoY to 16 million units in Q1 2022 as it continued rebuilding supplier relationships post its separation from Huawei. It also saw a 7% QoQ shipment growth despite a seasonal contraction of the global smartphone market. Consequently, its market share rose to 5% this quarter, up from 4% in the last quarter and 2% in the same quarter last year. It also did well in its home country of China where it is among the fastest-growing smartphone brands.
realme shipped 14.5 million units in Q1 2022, up 13% YoY. This was driven by realme’s expansion in the overseas markets, especially in Europe where its shipments grew by 163% YoY. At the same time, its global shipments have declined by 30% QoQ after a record quarter while its European shipments have taken a smaller hit of 7% caused by the Russia-Ukraine war. In India, realme was the only brand among the top five players to experience YoY growth (40%) in Q1 2022. It captured the third spot during the quarter.
Transsion Group, which includes Tecno, Infinix and itel, continued its strong performance with a 23% annual growth. This was driven primarily by Infinix, which grew by 76% YoY and 4% QoQ with its shipments increasing in India, the rest of Asia Pacific and Middle East and Africa. Tecno’s shipments also grew by 28% YoY while itel fell by 3%.
*Note: OPPO includes OnePlus since Q3 2021
Feel free to reach us at email@example.com for questions regarding our latest research and insights.
You can also visit our Data Section (updated quarterly) to view the smartphone market share for World, US, China and India.
Some of our latest regional smartphone market analyses:
Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services 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
Taipei, London, Hong Kong, Boston, Toronto, New Delhi, Beijing, Seoul – April 28, 2022
Global PC shipments fell 4.3% YoY in Q1 2022 to reach 78.7 million units, according to Counterpoint Research Global PC tracker. Entering 2022, the PC supply chain experienced easing component shortages and logistics issues compared to the second half of 2021. Order backlog from 2021 continued to contribute substantially to PC shipments in the beginning of 2022. This supports our previous view of another PC shipment plateau in 2022.
Our checks suggest the PC supply chain turned relatively conservative on shipment outlook in the middle of Q1 2022, largely dragged by global inflation and regional conflict, which brought uncertainties to PC demand and blurred the overall PC shipment momentum ahead. The overall PC shipments in 2022 are expected to be shy of our forecasts made at the end of 2021.
In addition, COVID-19 lockdowns in China, especially in Shanghai and Kunshan, where many laptop manufacturing lines are located, will cause shipment correction in April. Compared to OEMs, ODMs currently face more issues related to manufacturing resource allocation than component shortage impacts.
Global PC Shipments by Vendor, Q1 2022
Lenovo maintained its lead in the global PC market in Q1 2022 with a 23.1% share, which was down a little compared to 2021. The brand’s total shipments of 18.2 million units were down 9.5% YoY. Lenovo performed well during the pandemic largely due to its in-house manufacturing and operation control. This advantage will continue to help the company in times of demand uncertainty or component supply issues.
HP took a 20.2% share to capture the second spot. The company saw a 16% YoY decline in shipments largely due to Chromebook losing momentum and consumer demand weakness.
Dell, on the other hand, posted a slight increase in its shipments in the first quarter of 2022, riding on the commercial/premium product strategy tailwinds. Dell’s market share expanded by around 100 bps in Q1 2022.
Apple continued its success with the M1 MacBook series to see 8% YoY shipment growth in Q1 2022, which boosted its market share by 100 bps YoY. Asus saw 4% YoY shipment growth thanks to its gaming and commercial products expansion. Acer continued to struggle due to Chromebook sales losing momentum and ended the quarter with a 1% shipment decline. Asus and Acer both had ~7% market share in the quarter.
Component shortages likely to ease in H2 2022
In the past two years, the PC supply chain has spent much effort dealing with demand uncertainties caused by COVID-19 and component shortages. But since late 2021, demand-supply gaps have been narrowing, signaling an approaching end to supply tightness across the broader ecosystem. Among all PCs and laptops, the supply gap for the most important components such as power management ICs, Wi-Fi and I/O interface IC has narrowed. We have seen OEMs and ODMs continuing to accumulate component inventory to cope with uncertainties arising from COVID-19. Combined with the abovementioned consumer and Chromebook demand weakness, we believe component shortages are going to ease in H2 2022.
The potholes on the road to post-covid recovery for the global automotive sector seem never-ending. The back-to-back waves of COVID-19, followed by the semiconductor shortage and lack of auto spare parts supply forced the auto industry to axe nearly ten million vehicles from production in 2021. It was expected that 2022 would be better, as the auto industry was recovering from the chip shortage. But Russia’s invasion of Ukraine has pushed the auto industry, especially European players, into a vulnerable situation.
Without even bringing the supply of crude oil and natural gas into the scenario, the effect of this ongoing crisis on the automotive industry can be analyzed in two parts:
1. Production halt due to shortage of critical components and raw materials:
a. Direct short-term impact on production lines:
Vehicle production across Europe, especially Germany has been severely disrupted as Russia invaded Ukraine. Ukraine is one of the major suppliers of wire harnessing that connect and power all electronic components in a vehicle. An average car can have over 5.5km (3.5 miles) of wire harness. As many suppliers are based in Western Ukraine, German automakers have been able to procure them easily. But as Ukraine became engulfed, the harness supply chain has been disrupted, bringing the production lines of auto factories in Germany and other neighbouring countries to a halt. Auto OEMs including Volkswagen, BMW, Audi, Mercedes-Benz, and Porsche have either reduced production of selected models or temporarily halted production in certain plants across Germany, due to a shortage of wire harnesses. This is a direct effect of the war, and it has had an immediate impact. If the crisis stretches on, other sectors like component manufacturing will also be affected. The impact on the European auto OEMs could be greater than the COVID-19 outbreak.
b. Medium-term impact on component manufacturing:
Ukraine and Russia hold reserves of some rare elements required in the production of semiconductors, vehicle batteries and other related components. Ukraine caters to almost 70% of the world’s neon demand. This neon gas is required in lasers for lithography used in microchip production. The neon gas is a by-product of Russian steel plants, which is then filtered and supplied by Ukrainian companies. Similarly, palladium is used as a catalytic element for manufacturing microchips. If the crisis persists, the impact to raw materials could again impact semiconductor availability just as supplies were recovering. Similarly, nickel and cobalt are two major raw materials used in the production of automotive batteries. The larger manufacturers of microchips and batteries hold some material in reserve, but these are likely to be quickly depleted if the crisis stretches on for months. This will lead to increased prices of the respective components. With the financial sanctions imposed on Russia, the prices of these elements are likely to increase by at least 20%, which will make the production of electric vehicles more costly.
2. Revenue loss due to imposition of financial sanctions/business closures:
Russia is one of the bigger automotive markets globally. Vehicle sales in Russia exceeded 1.5 million and 1.6 million respectively in 2020 and 2021. But since the crisis started, almost every Western automaker has suspended business in Russia, denting revenues. Moreover, tier-1s and contract manufacturers have also suspended production and services. Auto OEMs such as Volkswagen, Ford, Toyota, General Motors, Honda, Bentley, Nissan, Porsche, Jaguar, Ferrari etc; and tier-1s and component manufacturers such as Continental, Magna, Aptiv, Leoni have all halted their exports to, and production in, Russia. The component suppliers and manufacturers are trying to shift their Russia production to other plants across different countries to curb the component supply shortage in the longer term. In Russia, Renault is the largest automotive seller and due to a $1 billion deal signed in 2007, Renault was unable to pull out of Russia and is bound to keep the production line open. Alongside Renault, Skoda also kept two of its factories in motion, but the production is severely impeded by sanctions imposed on Russia by the West. In this dark time, China is seeing some strong business opportunities. With almost no competitors, Chinese auto OEMs expect to win some extra market share and profit in Russia. China is walking a fine line between neither condemning nor condoning Russia’s action in Ukraine. This could pay dividends for Chinese auto vendors. But given the weak currency situation in Russia, it may not be an easy business to win.
The automotive industry is currently going through a very vulnerable period. Auto OEMs will be scrambling to enact contingency plans to deal with a persistent crisis. Though vehicle production lines and production of critical components are being shifted to other regions, the void for raw materials created due to the crisis is not going to be easily filled, which will force auto OEMs either to cut production or to offer vehicles with reduced specifications.
LATAM smartphone shipments grew 13.4% YoY in 2021 and .03% YoY and 9% QoQ in Q4 2021.
Samsung led the market with 38% share, followed by Motorola with 22.5% share.
Buenos Aires, New Delhi, Hong Kong, Seoul, London, Beijing, San Diego – February 24, 2022
LATAM smartphone shipments grew a healthy 13.4% YoY in 2021 despite the ongoing component shortages. However, the number was still 9% lower than that for 2019, according to Counterpoint Research’s latest Market Monitor tracker. Most of the 2021 growth was in the first half of the year, as COVID-19 lockdowns had hit growth in the same period of 2020.
Commenting on the market dynamics, Principal AnalystTina Lu said, “Most LATAM countries saw YoY growth driven by Chinese brands entering the region and increasing competition. But Brazil’s TAM decreased YoY. With local manufacturing/assembly representing more than 80% of its smartphone volume, Brazil felt the full impact of component shortages.”
Commenting on brand trends, Lu said, “All brands grew in volume during 2021, but some grew more than others. Samsung, the absolute leader in the region, increased only 6% in volume, but its ASP grew more than 19% YoY. The OEM’s shipments increased less than the overall market as it decided to produce higher-ASP devices due to chipset shortages.”
“Furthermore, LG exited the market during the second half of the year, leaving a void in the entry-level segment. Motorola and ZTE spotted the opportunity and moved in. Motorola’s volume increased 39% YoY and ZTE’s 74% YoY. But the brand that grew the most was Xiaomi, which aggressively entered the operator channel. Its volume almost doubled YoY. Xiaomi has been pushing its brand image in LATAM since 2018.”
LATAM Smartphone Shipment Market Share, 2021 vs 2020
Source: Counterpoint Research Market Monitor, Q4 2021 Notes: Xiaomi includes POCO
Commenting on the Q4 2021 market dynamics, Research Analyst Andres Silva said: “Despite the annual growth, Q4 2021 shipments increased only .03% YoY but 9% QoQ due to a combination of seasonality and improved supplies from China and Vietnam and local manufacturing/assembly. The fourth quarter is usually the biggest quarter for the LATAM smartphone market. But in 2021 many OEMs could not anticipate production constraints that impacted most of the second part of the year.”
LATAM Smartphone Shipment Market Share, Q4 2021 vs Q4 2020
Source: Counterpoint Research Market Monitor, Q4 2021 Notes: Xiaomi includes POCO
Q4 2021 Market Summary
Samsung led the region in Q4 2021 with its volume rising 12% QoQ but falling 1% YoY. The brand led in most of the countries in the region, except Argentina and Mexico. Samsung was impacted by supply shortages and not having enough entry-level products.
Motorola was the second biggest brand in the region. It led in Argentina and Mexico. Motorola managed to combine its brand recognition built over 30 years in LATAM and its entry-level models to grow in volume.
Xiaomi continued to grow in the region. It is now the solid number three. In Q4 2021, it saw 71% YoY growth. Its QoQ growth was drastically lower, hampered by supply shortages and not having local production in Argentina and Brazil. Xiaomi has recently announced it will start assembling smartphones in Argentina this year. Its volumes should grow further after local production starts.
Apple suffered huge constraints right after the launch of the iPhone 13. But the shortage appeared to ease by the end of the year with significantly increased shipments. Apple is the absolute leader in the region in the premium segment (>$500).
ZTE grew its volume 44% YoY by expanding sales beyond Mexico. It has a long-term relationship with carriers and offers a portfolio of <$100 smartphones.
Other Chinese brands like OPPO, vivo, realmeand TECNO are new entrants to LATAM. They spent most of 2021 building their branding in the region. OPPO was the most successful of all these brands, as it had already built some branding in Mexico several years ago. It is among the top five in Mexico, but Its expansion into other markets has not yet shown results.
“Others” decreased YoY. “Local kings” continue to drop with international and Chinese brands filling the gap.
Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services 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.
Global inflation of goods due to supply chain issues, rising energy prices, labor shortages and higher input costs has also made an impact on the handset market and will continue to keep prices inflated through 2022. In 2021, smartphone prices spiked globally but the inflation will be felt differently in various regions across the world.
10% YoY ASP increase in first three quarters of 2021 due to increased shipping and component costs.
Pre-paid segment experiencing more shortages as OEMs place more importance of producing high-end models.
4.7% YoY ASP increase in first three quarters of 2021, region seeing the worst inflation in 15 years.
Local currency depreciation having a significant impact on ASPs, Samsung being the only OEM to sell devices in local currency giving them a competitive advantage.
70% of customers need a payment plan in order to afford a smartphone, this is leading retailers to incorporate ‘hidden inflation’ in customers payment plans.
2.0% YoY ASP increase in first three quarters of 2021, smallest amount of inflation compared to other regions and not expected to change much in 2022.
OEMs are keeping prices as low as they can and will continue to do so, unless other macro factors like COVID-19 ramps up again in this region, that may affect ASPs in 202 depending on the impact on current supply chains.
Middle East and Africa
17.4% YoY ASP increase in first three quarters of 2021, the highest inflation globally at close to 8% as foreign exchange rates drop due to pandemic impacts on some key markets.
Supply disruptions for major Android vendors caused an impact on the distributers bottom line that forced these OEMs to pass the cost onto the customers.
Lowest price ranged devices felt the most impact of inflation, as OEMs are once again placing more importance on the supply of higher-priced handsets. This is causing customers with lower income hesitant on buying the latest phones.
There is also the expectation of more VAT or higher import taxes on handsets in the near future due to government policies to combat depreciating domestic currencies.
10.2% YoY ASP increase in first three quarters of 2021 due to shortages and supply issues as well but there was a GST hike in India during 2021 that added to the price of handsets in India.
OEMs are developing ‘creative pricing’ to hide the price increases by device as a newer version without upgrading specs and then selling at a higher price point.
Smartphone Chipset Observations and 2022 Outlook
Wafer prices at matured nodes have increased by 25%-40% between 2020 and now, likely to rise another 10%-20% in 2022. Advanced/leading edge nodes are not expected to rise since companies like TSMC and Samsung and more focused on cost-down execution to maintain profitability.
TMSC announced it will raise wafer prices from the beginning of 2022, this strategy implying a stronger demand going forward with tight supply lasting for the next few quarters. Smartphone OEMs will suffer the most on profit if they cannot balance the prices of handsets to customers. 5G growth may slow down in 2022 while the low-end and mid-end markets will face more difficulty as priority will be put onto high-priced smartphones that bring in a higher profit margin.
OEMs have been reluctant in 2021 to increase prices significantly with the fear of losing market share, so other strategies will be taken in 2022 to maintain costs. OEMs now must get creative in where to offset the cost of more expensive components. Xiaomi, for example, has taken steps to reduce the promotions on their handset devices to combat the increased prices of components. Some OEMs may have been prepared by stockpiling components at the beginning of the pandemic to offset the price increase. Many handset OEMs were not prepared in that sense, so the plans have been turned to reducing the Bill of Materials (BoM) costs in 2022 to offset the higher component cost and additional inflation.
Beijing, Boston, Toronto, London, New Delhi, Hong Kong, Taipei, Seoul – Nov 11, 2021
Smartphones featuring rear main cameras powered by 48MP and above megapixels accounted for 43% of total sales in Q2 2021, rising significantly from 38.7% in Q1 2021.
In front main cameras, the share of 20MP and above resolutions almost stayed flat QoQ in Q2 2021 due to the decline in sales of high-end models.
Despite supply shortages, smartphone rear cameras are increasingly adopting high-resolution image sensors, which continue to penetrate lower-end smartphone segments. According to the latest research from Counterpoint Smartphone Camera Tracker, smartphones featuring rear main cameras powered by 48MP and above megapixels accounted for 43% of total sales in Q2 2021, rising significantly from 38.7% in Q1 2021. The share of 64MP alone increased 3.5% QoQ to 14% in Q2 2021.
Commenting on this high-resolution advance, Senior Analyst Ethan Qi said, “48MP and 64MP have become the mainstream for models priced between $200 and $400, while flagship smartphones resort to large-area sensors to deliver a DSLR-like professional performance, of which 50MP is the most adopted. Although the share of 108MP fell to 3.1% in Q2 2021, the more affordable 0.7µm-based 108MP sensors continue to spread to mid-range models from OEMs such as Redmi and realme.”
On the other hand, low-resolution sensors continue to suffer from the demand-supply imbalance, with the price increasing sharply. For instance, 5MP sensors have experienced more than a 10% increase in cost since the beginning of this year.
Nevertheless, entry-level smartphones (wholesale price below $100) continue to upgrade their rear primary cameras from 8MP and below resolutions to 12MP or 13MP. Therefore, the collective share of the 8MP and below cameras shrunk to 5.9% in Q2 2021. With the launches of Samsung’s Z series in August and Apple’s iPhone 13 series in September, 12MP is expected to see significant growth in the second half of the year.
Composition Ratio of Smartphone Rear Main Cameras by Resolution (%)
Source: Counterpoint Smartphone Camera Tracker, Q2 2021
In front main cameras, the collective share of 20MP and above resolutions almost stayed flat QoQ in Q2 2021 due to the decline in sales of high-end models. However, we expect the resolution of the front-facing camera to continue to improve with more high-end smartphones adopting 32MP and even 48MP image sensors.
Meanwhile, the share of 8MP and below resolutions further increased to 45.2%, with 5MP and 8MP together accounting for 41.7% on strong demand for low-end smartphones in Q2.
Composition Ratio of Smartphone Front Main Cameras by Resolution (%)
Source: Counterpoint Smartphone Camera Tracker, Q2 2021
In September 2021, Samsung further pushed the smartphone CIS industry into the 200MP era with the new ISOCELL HP1 sensor, which is expected to enter flagship models in the coming quarters. In October, Sony launched the Xperia Pro-I with a 12MP 1-inch rear main camera, aiming to bring consumers a DSLR camera-like photography experience. Although mid- to high-end smartphones (wholesale price above $200) will continue to adopt high-resolution and large-area imaging sensors, the upgrade may slow down due to the ongoing component shortages and rising bill of materials (BoM) costs. We will keep a close eye on it.
The comprehensive and in-depth ‘Smartphone Camera Tracker, Q2 2021’ is now available for purchase. Feel free to reach out to us at press(at)counterpointresearch.com for further questions regarding our latest research and insights.
Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services 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
In order to access
Counterpoint Technology Market Research Limited (Company or We hereafter) Web sites, you may be asked to complete a registration form. You are required to provide contact information which is used to enhance the user experience and determine whether you are a paid subscriber or not.
When you register on we ask you for personal information. We use this information to provide you with the best advice and highest-quality service as well as with offers that we think are relevant to you. We may also contact you regarding a Web site problem or other customer service-related issues. We do not sell, share or rent personal information about you collected on Company Web sites.
How to unsubscribe and Termination
You may request to terminate your account or unsubscribe to any email subscriptions or mailing lists at any time.
In accessing and using this Website, User agrees to comply with all applicable laws and agrees not to take any action that would compromise the security or viability of this Website. The Company may terminate User’s access to this Website at any time for any reason. The terms hereunder regarding Accuracy of Information and Third Party Rights shall survive termination.
Website Content and Copyright
– Passwords are for user’s individual use
– Passwords may not be shared with others
– Users may not store documents in shared folders.
– Users may not redistribute documents to non-users unless otherwise stated in their contract terms.
Changes or Updates to the Website
Accuracy of Information:
While the information contained on this Website has been obtained from sources believed to be reliable, We disclaims all warranties as to the accuracy, completeness or adequacy of such information. User assumes sole responsibility for the use it makes of this Website to achieve his/her intended results.
Third Party Links:
This Website may contain links to other third party websites, which are provided as additional resources for the convenience of Users. We do not endorse, sponsor or accept any responsibility for these third party websites, User agrees to direct any concerns relating to these third party websites to the relevant website administrator.
Cookies and Tracking
We may monitor how you use our Web sites. It is used solely for purposes of enabling us to provide you with a personalized Web site experience.
This data may also be used in the aggregate, to identify appropriate product offerings and subscription plans. Cookies may be set in order to identify you and determine your access privileges. Cookies are simply identifiers. You have the ability to delete cookie files from your hard disk drive.