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TECNO, Infinix, Apple Fastest-growing Smartphone Brands in Southeast Asia

  • Southeast Asia’s smartphone shipment volumes declined 2% YoY but increased 3% QoQ in Q3 2023, signaling a recovery in the region’s smartphone demand.
  • The fastest-growing brands were TECNO (148%), Infinix (42%) and Apple (19%). All three Transsion brands collectively grew by 62% YoY in Q3 2023.
  • Samsung led the market with a 21% share, followed by Xiaomi (17%) and OPPO (15%).
  • Indonesia and Thailand saw flattish growth while other SEA countries like the Philippines, Malaysia and Vietnam declined YoY.
  • 5G smartphones captured 36% of overall shipments in the region.

Jakarta, Hong Kong, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – November 9, 2023

Southeast Asia’s smartphone shipments declined 2% YoY but increased 3% QoQ in Q3 2023, signaling a recovery in the region’s smartphone demand, according to Counterpoint Research’s Southeast Asia Monthly Smartphone Channel Share Tracker. Stronger macroeconomic indicators, aggressive new OEM launches and aggressive promotions by OEMs and other platforms were the main growth contributors. Also, an uptick was seen in the replacement cycles of consumers opting for low-to-mid-tier smartphones. TECNO, Infinix and Apple emerged as the fastest-growing brands during the quarter.

Most key SEA countries like Indonesia, Malaysia, Philippines and Vietnam showed a double-digit decline in Q2 2023, but they improved in Q3 2023, hinting a relief for OEMs ahead of an important festive quarter. However, on an annual level, we foresee a YoY decline of about 8% for the region in 2023.

SEA remains an important market for the tech ecosystem due to its underpenetration in many areas, like online banking, e-wallet usage, online shopping and overall internet usage.

A chart showing SEA Smartphone Shipments by Key Countries
Source: Counterpoint Research Southeast Asia Monthly Smartphone Tracker, September 2023

Key country insights

  • Indonesia and Thailand saw flattish growth in smartphone shipments while other key SEA countries like the Philippines, Malaysia and Vietnam declined YoY.
  • In Thailand, the new government launched several initiatives, such as delaying debt payments, lowering energy prices and offering cash handouts, to ease the citizen’s cost of living. This brought immediate effect on commodities. Besides, in September, the government announced visa-free entry for tourists from China and Kazakhstan, bringing much relief to the country’s COVID-hit tourism industry.
  • In Indonesia, OEMs launched several new models in the middle and end of September. The new launches made up a big share of the overall shipments. During the quarter, Indonesians preferred to wait and watch when it came to spending money. The country is gearing up for its legislative and presidential election in February 2024. We expect Q4 2023 to see more smartphone sales due to aggressive offers.
  • Vietnam’s economy has picked up with its exports coming back on track. GDP grew 5.33% in Q3 2023, beating expectations. Foreign investment is expected to rise with Vietnam entering strategic partnerships during the prime minister’s visit to the US in September.
  • In the Philippines, the economy is showing signs of recovery. Consumer confidence has improved. Unemployment is a concern and essentials are still expensive for low-income families. Due to easing inflation, the coming months might see increased household spending. Overall, the household expenditure levels might take some time to recuperate, which might affect smartphone purchases.
  • In Malaysia, industrial manufacturing is still slowing down due to weaker demand for electrical and electronic products. Weaker exports have added to the decline in GDP as well. Malaysia’s 5G connectivity and penetration are improving now but the overall industry is being affected by China’s economic headwinds.
A chart showing Southeast Asia Smartphone Shipments Market Share
Source: Counterpoint Research Southeast Asia Monthly Smartphone Tracker, September 2023

Key OEM insights

  • Beating the trend, Apple’s shipments increased by 19% YoY during the quarter. Apple is still seeing a strong demand for the iPhone 13 and 14 series, adding to the demand for the newly launched 15 series.
  • Samsung led the market with a 21% share. Its A05 series has entered the market, adding to a strong overall A-series presence. Premium models like the Z Flip 5 and Z Fold 5 along with the S series are contributing as well. Promotions for the brand are centered around these premium models not only in countries like Thailand and Vietnam but also increasingly in countries like Indonesia and the Philippines. This is due to premium smartphone purchases by well-to-do consumers who are least affected by current headwinds. Samsung was the top brand in Indonesia, Thailand and Vietnam in Q3 2023.
  • Xiaomi’s shipments grew 7%. Its Redmi 12 series has been doing quite well across all key SEA countries. Its promotions and new model launches were also better than most other brands during Q3 2023, which helped the brand increase shipments. Xiaomi was the top brand in Malaysia in Q3.
  • Transsion witnessed the highest growth during the quarter. Infinix grew 42% YoY, TECNO 148% and itel witnessed a 17% growth. Infinix and TECNO are offering strong base specifications along with a varied model portfolio.
  • realme saw flat growth during Q3 2023. It was the top brand in the Philippines.

Commenting on brand dynamics in Q3 2023, Senior Analyst Glen Cardoza said, “Samsung and Xiaomi have been able to market their models in a much better manner across all key SEA countries, while sustaining new launches across price ranges, compared to the limited options from brands like OPPO and vivo. Upcoming brands are making a mark as well. Among them, the Transsion brands lead. TECNO and Infinix have either sustained or increased their new model launches, all in the entry to mid-tier segments. The three Transsion brands collectively grew 62% YoY in Q3 2023.”

While 5G penetration still has some way to go in countries like Indonesia, Vietnam and Malaysia, 5G is increasingly becoming a key consideration for consumers. Many consumers want their phones to be 5G ready. During Q3 2023, 5G smartphones captured 36% of overall shipments in the region.

The region’s key macroeconomic parameters like China-ASEAN trade, startup funding and foreign direct investment continue to see YoY declines. Add to this a recovering tourism industry. This has led to low GDP levels across most SEA countries. Price-conscious consumers have waited all year for the situation to get better, spending the least on discretionary items. On the positive side, digital transformation continues even as the industry recuperates slowly. This means that we can expect a better Q4 of 2023.

* Key Southeast Asia countries/markets include Indonesia, Thailand, Philippines, Vietnam and Malaysia.

Feel free to contact us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

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.

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SE Asia Becomes World’s Hottest EV Market As Asian OEMs Take Pole Position

  • SE Asia was the hottest major EV market globally in Q2, growing nearly 10X YoY driven by key countries in Indochina
  • BYD took top position in unit sales share followed closely by domestic market favorite Vingroup
  • Chinese OEMs advanced the most, underscoring strong demand for lower-tier price segments

Hong Kong, Jakarta, New Delhi, London, Boston, Seoul – September 21, 2023

According to Counterpoint Research’s latest SE Asia Passenger Electric Vehicle Tracker, Q2 2023 battery electric vehicle (BEV) unit sales in the region grew by 894%, driven by strong demand across Thailand, Vietnam, Indonesia, and Malaysia.

Base effects are in play as markets are very early stage, but significant progress is being made with EV share of overall passenger vehicle sales rising to over 6% during the quarter, with key Asian OEMs capitalizing on strong initial demand.

Passenger EV* Unit Sales Share and YoY Growth by Auto Group

A chart depicting the South-East Asia Passenger EV Unit Sales Share Q2 2022 vs. Q2 2023
Source: Counterpoint Research SE Asia Passenger EV Tracker. *Battery electric vehicles (BEV) only.

“What we’re seeing is just the beginning with SE Asia’s biggest markets starting to scale. It’s happening as government efforts to promote electrification dovetail with a flurry of products coming online that might not be budget, but are a lot more accessible to more buyers in the region,” says Soumen Mandal, Senior Analyst for Automotive. “Vietnam and Thailand are great examples, with automakers introducing lower-priced models targeting the broadest range of consumers.”

“The result has been a big decline in prices over the past year as OEMs like Vinfast and BYD introduced cars with better sticker appeal. Comparing the top 5 best sellers YoY, prices have come down over 20%.”

A chart showing SE Asia’s Best-Selling Passenger EVs

Chinese OEMs are set to become the biggest beneficiary of SE Asia’s appetite for EVs over the short term, and Thailand will be a hot spot as this new breed of automakers sets up shop in the Kingdom – the region’s auto manufacturing hub; traditional players like Toyota are leaving the door open as they falter in the transition to EVs.

“There’s a big window of opportunity especially for someone like BYD, which has enjoyed a massive home market head start,” notes Ivan Lam, Senior Analyst for Manufacturing.  “Scale and end-to-end manufacturing prowess gives it a competitive advantage few EV players can match – affordable cars, robust supply, more frequent product launches. This might not sound exciting in terms of traditional combustion engine vehicles, but in EVs, it’s revolutionary.”

Background

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.

Follow Counterpoint Research

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Southeast Asia BEV Sales Grow 10x YoY in Q1 2023, Thailand Leads

  • Thailand accounted for over 75% of BEV sales in the SEA region during Q1 2023.
  • Three out of every four BEVs sold were from a Chinese automaker.
  • The top three groups accounted for 68% of BEV sales.
  • BYD’s Atto 3 was the best-selling BEV.

New Delhi, London, San Diego, Buenos Aires, Hong Kong, Beijing, Seoul – July 20, 2023

Southeast Asia’s# (SEA’s) passenger battery electric vehicle (BEV) sales* grew by almost 10 times YoY in Q1 2023, according to the latest research from Counterpoint’s SEA Passenger Electric Vehicle Model Sales Tracker. The share of BEVs in total passenger vehicle sales experienced significant growth in Q1 2023, reaching 3.8% compared to a mere 0.3% one year ago. Thailand emerged as the leading country, capturing over 75% of the BEV sales, followed by Indonesia and Vietnam. Thailand also boasted the highest proportion of BEVs in total passenger vehicle sales, followed by Singapore and Vietnam. However, plug-in hybrid electric vehicle (PHEV) sales saw a modest YoY growth of 5.8%.

SEA region BEV sales share by major countries, Q1 2023

Commenting on the market dynamics, Research Analyst Abhilash Gupta said, “Thailand’s government-led efforts to promote EV sales have yielded positive outcomes, while Indonesia and Vietnam are also performing well in the region. However, Malaysia, Philippines and Myanmar require additional regulatory support and encouragement to foster EV growth. Despite overall passenger vehicle sales remaining relatively stagnant, the sales of BEVs have experienced a significant and rapid expansion. Besides, the market for hybrid electric vehicles (HEVs) has experienced remarkable growth in SEA, playing a pivotal role in the transition from traditional internal combustion engine (ICE) vehicles to EVs.”

Gupta added, “Chinese auto groups are experiencing rapid growth and outpacing their competitors in the SEA region, with their market share increasing from 38% a year ago to nearly 75%. In Q1 2023, BYD Group emerged as the BEV leader in the SEA region, capturing the majority of sales, followed by Hozon New Energy, and SAIC Group. These top three groups collectively accounted for over 68% of the BEV market. In the PHEV market, Geely Holding Group claimed the top position, followed by BMW Group, and Mercedes-Benz Group.”

BYD’s Atto 3 was the best-selling BEV across SEA, followed by the Neta V and Tesla Model Y. In PHEVs, Volvo’s XC60 sold the most, followed by the BMW 3 series and Mercedes-Benz E-Class.

SEA top 3 BEV sales share, Q1 2023 & SEA top 3 PHEV sales share, Q1 2023

Commenting on the market outlook, Senior Analyst Soumen Mandal said, “In addition to offering subsidies and tax incentives, Thailand’s government has set ambitious goals to position itself as a global hub for EV production. The country’s EV sector has witnessed a significant rise in foreign direct investment (FDI) in the past year. Notably, several Chinese automakers, including Great Wall Motors, BYD, Hozon New Energy and Changan Automobile, have shown interest in establishing or have already commenced the construction of production facilities in Thailand. Similarly, Indonesia announced a subsidy package in March 2023 to promote the purchase and manufacturing of EVs, with a special focus on increasing local production. This move is expected to further accelerate the production and sales of EVs in the region.”

Mandal added, “The Chinese presence in the SEA EV market is poised to strengthen as they establish regional manufacturing bases, thereby driving further growth in the EV sector. The overall sales of EVs are experiencing an upward trajectory in the SEA region. The outlook appears promising, and there is an expectation that the share of BEVs in total vehicle sales will reach 6% by the end of this year.”

*Sales refer to wholesale figures, i.e. deliveries from factories by the respective brands/companies.

#SEA here includes Indonesia, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.

The comprehensive and in-depth ‘Southeast Asia Passenger Electric Vehicle Model Sales Tracker, Q1 2018 – Q1 2023’ is now available for purchase at report.counterpointresearch.com.

Feel free to reach us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

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.

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Abhilash Gupta

 

Soumen Mandal

 

Abhik Mukherjee

 

Peter Richardson

 

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Apple Shines in a Declining Southeast Asia Smartphone Market

  • Smartphone shipments in Southeast Asia’s five key markets* declined 13% YoY in Q1 2023.
  • Apple’s shipments increased by 18% YoY during the same period.
  • Infinix witnessed a 41% increase as the brand grew across SEA markets.
  • While mid-to-high-end ($201-$600) ranges suffered the most, the >$600 range shipments increased by 4%.

Jakarta, Hong Kong, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – May 15, 2023

Smartphone shipments in Southeast Asia’s five key countries (Indonesia, Thailand, Philippines, Vietnam and Malaysia) fell 13% YoY due to low demand and a seasonal drop, according to Counterpoint Research’s Southeast Asia Monthly Smartphone Channel Share Tracker.

All key SEA countries saw a decline in Q1 2023 but some more than others. Countries like Vietnam received relatively more shipments in Q4 2022 and so OEMs felt the need to reduce volumes in Q1 2023. Consumer sentiment has not completely revived in Vietnam. Factors like a 10% fall in Samsung’s production, seasonally low smartphone demand after Q4 2022, and reduced revenues for OEMs and operators were also among the driving factors. Indonesia and Thailand did comparatively well than the other countries as demand started improving in March 2023.

Southeast Asia Smartphone Shipments by Key Countries

Source: Counterpoint Research Southeast Asia Monthly Smartphone Tracker

All key SEA countries are coming out of the geopolitical effects from last year while still reeling under some inflation effects. For instance, the Philippines suffered high inflation at the start of this year. However, operators continue to remain aggressive on 5G development and partnerships with tech companies. The industry has resumed its earlier levels of advancement as foreign investments are again entering big economies like Indonesia and Malaysia. There are collaborations happening on the financial services front as well. For example, OPPO in Indonesia is partnering with banks to provide banking services while AIS, the leading operator in Thailand, has partnered with Bangkok Bank to provide financial services on digital platforms. Consumers are not exactly feeling the improvements on the ground though. Most smartphone purchases are being delayed.

Southeast Asia Smartphone Shipments Market Share

Source: Counterpoint Research Southeast Asia Monthly Smartphone Tracker

Vietnam is a growing Apple iPhone market. The demand for the iPhone 13 and 14 series was good in Q1 2023. Indonesia has seen growth in iPhone shipments as well. Overall, iPhone shipments grew 18% YoY in Q1 2023.

Infinix is the official smartphone partner for Mobile Legends professional league in the Philippines. Infinix has improved on promoting itself as a gaming brand in the region. Overall, though Infinix’s volumes are not on a par with the top brands, it continues to grow in the region. The brand grew 41% in Q1 2023.

While certain brands have been in focus at the start of this year, the price range share favored two consumer groups in Q1 2023. <$200 smartphones witnessed a 4% YoY growth despite an overall decline in volumes. Since entry-level phone shipments had been consistently low, pent-up demand motivated higher shipments in Q1 2023. However, not all countries saw a spike in low-end smartphone demand. OEMs in Vietnam were still looking to push these volumes. The Philippines’ low-income families are reeling under high tax and inflationary issues, restricting low-end smartphone purchases. Premium-end (>$600) smartphone shipments continued to rise and saw 4% YoY growth. Mid-to-high-end ($201-$600) smartphone shipments suffered the most across the region.

Commenting on the SEA economies in 2023, Senior Analyst Glen Cardoza said, “Southeast Asia is at a stage where different consumer types are behaving in a different manner. Low-end smartphone buyers are recovering but they are not just there yet. Mid-to-high-end smartphone buyers are holding on to their wallets and extending the ownership of their phones, while high-to-premium smartphone buyers are unaffected by the economics of the situation. These consumers are going out and choosing to buy the S series, foldables and iPhones. While 5G is becoming a norm, operators are coming out with creative packages and providing options for all types of smartphones. The coming months are likely to see a bit more improvement in consumer sentiment while governments make sure that their countries remain largely unaffected by global macro issues.”

The Vietnamese government is looking to commercialize 5G in the country this year. This will facilitate a new level of manufacturing and consumer usage if done earlier than later. While the Malaysian government and industry work on 5G commercialization and the terms for it, consumers are already equipped with 5G smartphones.

With an increase in tourism in SEA countries earlier in the year, there is a chance that tourism business and revenue will increase this year. Countries like Thailand are also concentrating on eco-tourism initiatives that focus on sustainability, all through smartphones. All these developments are likely to spell normalcy for the public, leading to a likely improvement in consumer sentiment in the coming quarters.

* Key Southeast Asia countries/markets include Indonesia, Thailand, Philippines, Vietnam and Malaysia.

Feel free to contact us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

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.

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Entry-level Smartphone Shipments Bounce Back in Key SEA Countries, Up 28% QoQ in Q4 2022

  • 2022 saw a 13% YoY decline in smartphone shipments in key Southeast Asian countries*.
  • All countries witnessed a YoY drop in shipments through 2022 with the gap widening to -17% in Q4.
  • Samsung and Apple sustained volumes through the year, while Infinix grew the most.
  • High-end smartphone ($400-$600) shipments increased 8% YoY in 2022.
  • The premium segment (>$600) witnessed a 23% YoY growth.

Hong Kong, Jakarta, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – February 23, 2023

Key Southeast Asia (SEA) smartphone markets* saw a somewhat consistent YoY drop in shipments throughout 2022. Inventory was still high in countries like Indonesia, Philippines and Thailand, which led to a 17% YoY drop in shipments in Q4 2022, according to the Market Monitor Smartphone Quarterly Report.

More notably, the end of the year signaled a much-awaited increase in demand for entry-level smartphones, resulting in a 28% QoQ increase in such shipments. New launches and pent-up demand played major roles in this. In the premium segment, consumers kept the demand alive due to which there was a 22% QoQ increase in premium shipments.

Southeast Asia Smartphone Retail Prices, Q3 2022 vs Q4 2022

Source: Counterpoint Research Southeast Asia Smartphone Tracker, February 2023

While the region’s smartphone shipments declined, countries like Vietnam and Philippines showed more resilience to economic factors than others. Consumer demand seemed to have been less affected by macro effects. Smaller markets like Cambodia, Myanmar and even Malaysia declined relatively more. While they represent a small part of the region, their populations include a higher share of economically disadvantaged consumers. The decline in entry-level smartphone shipments affected these countries more than the rest.

Mature markets like Thailand and Singapore concentrated more on 5G penetration and further stages of industrial 5G applications. Singapore’s operator partnership with Ericsson and 5G utilization in healthcare planning are just a few examples. In Thailand, smart factory technology is being developed, private networks are increasingly used, and operators like AIS are helping out on automation through 5G.

Apart from an uptick in premium smartphone sales in these countries, there was also an increased focus on sustainability in the form of trade-ins, refurbished smartphone demand and corporate ESG initiatives.

Southeast Asia Smartphone Shipments by Key Countries

Source: Counterpoint Market Monitor Smartphone Report, February 2023

The IT and e-commerce sectors saw job cuts in SEA which did not project a healthy H2 2022. Even the online smartphone channels contributed relatively less in seasonal campaigns like 11.11 and December sales. At the same time, OEMs, operators and retailers have been increasing offline networks across geographies. As the economies are struggling to come back to normal, a surge in tourism in this region contributed to the rebound.

Chinese brands like vivo, realme and Xiaomi consistently struggled with inventory levels and low shipments during Q3 and Q4 2022. OPPO improved with demand due to its Reno series.

As premium demand surged, Samsung’s S series and Apple’s iPhone 13 and 14 series contributed to these brands’ volumes. Vietnam showed some surprising success with Apple shipments. Apart from newer models, even older ones like the iPhone 11 series were being sold well in the country.

The biggest gainer of 2022 is clearly Infinix. The Transsion brand steadily grew in this region in 2022. Infinix’s focus on basic specs, practical pricing, channel offers and gaming all helped it gain momentum. The brand is especially doing well in the Philippines, Indonesia and Thailand.

Southeast Asia Smartphone Shipments by Brand

Source: Counterpoint Market Monitor Smartphone Report, February 2023

Commenting on the SEA economies in 2023, Senior Analyst Glen Cardoza said, “Southeast Asia suffered on multiple fronts in 2022. Countries continue to increase interest rates, inflation is still a factor and trade volumes are dependent on the partner country’s demands. Any macro-level improvements in tourism, government relief and financial management will take time to positively impact the common consumer. In the absence of further adverse macro effects, the region is on a path to recovery. OEMs are however pessimistic about the recovery at this point and it is visible in their shipment levels. Improving entry-level smartphone shipments is a much-needed boon at this point. H1 2023 is likely to suffer the effects of low shipments, but we are likely to see a steady increase in shipments starting Q2 2023.”

Industrial and consumer 5G use cases will be visible in countries like Singapore and Thailand, while Indonesia and Philippines will concentrate on 5G penetration more than others.

What is China’s loss is working out to be Southeast Asia’s gain in part. Manufacturing centers like Vietnam stand to benefit from increased investments from companies looking to diversify from China.

The silver lining lies in the role of smartphones in digital transformation across this region. It also lies in the increase of foreign direct investment. All macro factors remaining constant, H2 2023 has the potential to make up for H1’s losses.

* Key Southeast Asia countries/markets include Indonesia, Thailand, Philippines, Vietnam, Malaysia, Singapore, Myanmar and Cambodia.

 

Feel free to contact us at press@counterpointresearch.com for questions regarding our latest research and insights.

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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.

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Premium Smartphone Shipments Grow 29% YoY in Q3 2022 in Key SEA Markets

  • Premium smartphone (>$400) shipments grew 29% YoY while the <$200 price band shipments fell 24%.
  • Overall Southeast Asia smartphone shipments dropped 10% YoY.
  • Apple’s iPhone shipments grew 63% YoY in Q3 2022.
  • 5G made up 32% of total shipments in the key countries, 5G smartphone shipments grew 56% YoY in Q3 2022.
  • The $200-$400 5G smartphone band saw a 73% YoY growth.

Hong Kong, Jakarta, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – November 17, 2022

Premium smartphone (priced more than $400) shipments in the key Southeast Asian markets* increased 29% YoY in Q3 2022, according to Counterpoint Research’s Southeast Asia Monthly Smartphone Channel Share Tracker. On the other hand, total smartphone shipments declined 10% YoY during the quarter. Southeast Asia is still facing macroeconomic headwinds. This has resulted in weak business and consumer sentiments. Investments have slowed down too, including FDI volumes for some countries. All this has led to key smartphone OEMs collecting more than the required inventory before Q4 2022. The massive YoY increase in premium smartphone shipments reflects the resilience of this segment’s customers during difficult times.

Key SEA Smartphone Markets Shipments by Price Band Q3 2022

Source: Counterpoint Research Southeast Asia Monthly Smartphone Channel Share Tracker, November 2022

September was supposed to see an increase in shipments across the region. But in 2022, this seasonal behaviour has been limited due to consistently low consumer sentiment. The lower economic strata are reeling under economic uncertainty, which shows in lower shipments and higher inventories overall. The Q4 festive season is expected to bring some relief.

There were some brand-level hits and misses too in Q3 2022. While Samsung shipments fell 13% YoY, Apple’s shipments were up 63% YoY across all the key countries. Vietnam seemed to be grabbing iPhones at a faster rate than its neighbours.

5G smartphone demand has seen slow progress in some countries like Indonesia and Vietnam while it is much faster in Thailand and Philippines, where the network is better and a large number of consumers are quite tech-savvy. Operators are still giving good package value to consumers even as it affects margins.

Specifications like processor, RAM, internal storage, battery capacity and charging speed remain a priority. Even if consumers in Indonesia and Vietnam do not actively consider 5G as a purchase factor, they tend to count it as a feature needed for the future.

Operators like Globe in the Philippines are keen on expanding their 5G infrastructure beyond the metro areas, whereas in Indonesia, 5G use cases have started showing for industries like mining. The $200-$400 5G smartphone price band saw a 73% YoY growth, which means that 5G is being made a staple feature by most OEMs.

5G Smartphone Shipments and Penetration by Price Band Q3 2022

Source: Counterpoint Research Southeast Asia Monthly Smartphone Channel Share Tracker, November 2022

Commenting on the economy, Senior Analyst Glen Cardoza said, “Most Southeast Asian countries like Indonesia, Thailand and Philippines raised interest rates in Q3 2022 to ease the blow of rising prices on the common consumer. Inflation during the quarter was an average 5% in most SEA countries, which is not alarming but did take its toll on consumers. Prices for fuel, overall logistics and staple items went up, causing consumers to hold on to their wallets and defer big expenses like smartphones. The majority of such consumers are blue-collar workers or from economically weaker sections. While a country like Thailand is struggling to regain pre-COVID volumes due to depleted tourism levels, Vietnam has shown a 13% GDP growth in Q3. The effect of the same is reflected in the smartphone shipments in the last few months.”

OEMs still have more than the required inventory of older models which they might try to sell using all possible marketing tools across offline and online channels. New models launched since August will continue to fill the market with mostly 5G devices. Offline retail players are likely to propagate experiential outlets, increased payment convenience, trade-in offers and better after-sales support. Models like Samsung’s Galaxy A04s and vivo’s Y02s might lead the charge in increasing low-range smartphone shipments again. This is necessary for the market to portray normalcy.

* Key Southeast Asia countries include Indonesia Thailand Philippines and Vietnam

Feel free to contact us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background

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.

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Glen Cardoza

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Podcast #57 – Will 5G Offset Macroeconomic Weakness in SEA Smartphone Market?

Southeast Asia, one of the world’s most promising markets, saw its smartphone shipments decline in Q2 2022. But despite this, Thailand’s premium smartphone market grew 22% YoY, confirming a key trend in the overall Southeast Asian market. Other key trends in the region include the growth of gaming and 5G smartphones.

Rising inflation and reduced consumer spending are resulting in a lengthening smartphone replacement cycle. So, how are OEMs navigating this trend with different financial schemes, easy upgrades, cashbacks and more? 5G smartphone shipments in Southeast Asia markets are also growing, so how are operators geared up for rolling out 5G services and demonstrating their use cases?

In the latest episode of ‘The Counterpoint Podcast’, host Tarun Pathak is joined by Senior Analysts Febriman Abdillah and Glen Cardoza to discuss the key trends in the SEA smartphone market. From falling shipments to H2 2022 outlook, 5G and online vs offline, we discuss all this and more in the podcast.

Hit the Play Button to Listen to the Podcast

You can read the podcast transcript here.

Podcast Chapter Markers

01:42 – Glen talks about smartphone shipments decline in Southeast Asia and key trends to look for.

03:10 – Febriman weighs in on smartphone OEM strategies as rising inflation is resulting in reduced consumer spending.

05:26 – Glen on how OEMs are navigating the trend of lengthening replacement cycle.

07:44 – Febriman talks about different financial schemes from brands to push consumers to upgrade to newer devices.

10:32 – Glen on how online channels are shaping up in key Southeast Asian countries.

12:34 – Febriman on offline channels in Southeast Asian countries and how distributors are increasing their reach.

15:27 – Glen talks about 5G in Southeast Asia from the devices’ point of view, and how it is trickling down to lower price points.

17:50 – Febriman on how operators are preparing for 5G rollout, creating awareness and demonstrating use cases.

20:58 – Glen and Febriman discuss the H2 2022 outlook for the SEA smartphone market.

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Southeast Asia Can’t Get Enough of Smartphone Gaming

Gaming as an industry has been growing in leaps and bounds globally. While consoles and PCs are widely used platforms, the smartphone gaming demographic is growing the fastest and this is particularly seen in Southeast Asia. The region also looks to be more promising as there are many factors propelling the current growth, chief among them being a whole new demographic adopting smartphones, getting digitally savvy and getting to know the gaming world. There are other important factors like increased internet connectivity and favorable changes accelerated by the COVID-19 pandemic in the last two years.

There are many other reasons at the country level as well, but there is one undeniable factor that would not have made this growth possible – smartphones. According to Counterpoint Research’s Southeast Asia Smartphone Tracker, key Southeast Asian countries’ (Indonesia, Thailand, Philippines, Malaysia and Vietnam) smartphone shipments in 2021 were back to 2019 levels.

Counterpoint Research Smartphone Shipments in 5 Key Southeast Asian Countries 2015-2021
Source: Counterpoint Research Southeast Asia Smartphone Tracker

Gaming smartphones continue to see an increase in demand. During the festive season in Q4 2021, gaming smartphones saw a 270% YoY increase. The affluent gamer demographic is growing exponentially, and this trend is likely to increase with all the focus that gaming is getting in these markets. Along with consumer interest, there is an increased focus on e-gaming from governments and industry players across the ecosystem. Currently there are more than 102 million active smartphone gamers in the 5 key Southeast Asian countries and this number is bound to increase in the coming years.

Growth in Specialized Gaming Smartphones 2020 2021 v2

Source: Counterpoint Research Southeast Asia Smartphone Tracker

Indonesia, Malaysia, Thailand, Vietnam, Singapore, and the Philippines are the six most significant countries for mobile gaming in Southeast Asia. Whether they are small quick games to pass some time or more engaging strategy and shooter-type games, the gamer consumer base has gone up in the region just as fast as smartphone adoption over the last two years.

Factors pushing gaming growth over the last two years:

  • Investments in internet penetration, especially in Tier 2 and Tier 3 cities.
  • Increased focus on 5G infrastructure growth and adoption.
  • Consistently growing demand for smartphones, gaming smartphones in particular.
  • An effective way to pass the time when stranded at home during pandemic lockdowns and restrictions. For many people, less work or no work is a motivation to play on smartphones.
  • An escape from ongoing volatility in macroeconomic factors like inflation, sustained COVID-19 repercussions, war situation in Europe and other more country-level factors.
  • Widening choice with multiple gaming genres (like strategy, shooting and e-sports) across multiple platforms (mobile, PC, console and even television).
  • Types of games all the way from casual to elaborate heavy-duty games that make a player a full-time earning pro-gamer. Some countries in this region also promote international gaming tournaments.

Connectivity and Ecosystem Initiatives:

 Connectivity has played a vital role in increasing online gaming in the region. Fixed broadband connections have seen tremendous growth in the last two years along with a jump in new subscribers. Tier 2 and Tier 3 cities in the key SEA countries have seen some major growth as well. Broadband, whether fiber or fixed wireless, makes up more than 38% of the base in these key SEA countries. 5G connectivity is being improved starting with metro and Tier 1 cities. 4G connectivity is being increased throughout these countries as well. All this has played a major role in pushing the gaming culture irrespective of geography, age, gender, or economic background of the user.

OEMs have understood that a good gaming experience is supposed to be a necessity even for the casual gamer and not just the heavy-duty gamer.

Esports is big in the Philippines. realme, one of the top smartphone brands in the country, has partnered with the national team SIBOL for esport tournaments. realme itself has its pro-gaming tournament ‘Realme Mobile Legends Cup’ in the country.

Infinix is an upcoming brand in most Southeast Asian countries. Its focus on gaming models has led to the brand being considered for low-range to mid-range smartphones for gaming. Gaming smartphone biggies like Asus have said that the gaming smartphone business is not yet profitable for them, but they are still sticking to their image and launching more gaming phones.

Operators like Dtac in Thailand are offering gamers a specialized package with maximum speed and special internet lanes to make sure excess usage does not result in lags.

Top semiconductor companies Qualcomm and MediaTek have been focusing on the gaming consumer for a while now with gaming-related chipset versions of their standard offerings. Even chipset makers like ARM have been considering gaming as a motivation behind future tech. ARM recently came out with a gaming-specific chip.

The Changing Ecosystem:

 There is a mix of low-end to high-end smartphone users in each of the SEA countries, but every country shows different characteristics and preferences in gaming genres. Southeast Asia’s consumer base is maturing. Indonesia and Thailand are the region’s largest revenue earners, followed by the Philippines and Malaysia. The Indonesian market is not only the region’s largest but also the fastest growing. In Southeast Asia, the younger population, which used to play smaller games on cheaper phones, is upgrading to mid-tier phones and preferring more heavy-duty games.

It is already established that SEA is a huge gaming market with more potential but there are many factors changing this volatile tech trend currently.

Trends changing the gaming ecosystem:

  • Female gamers lead male gamers in many areas of the region. Most avid gamers can be found between the ages of 25 and 60. The bulk of this demographic in the region usually does not have a very high-priced smartphone. This means that even low-range to mid-range smartphones are being used for gaming and not necessarily just for casual games.
  • Increase in video content related to gaming, with the rising viewership on online platforms such as Twitch and YouTube, is resulting in marketing initiatives across platforms, apps and games.
  • Cloud-based gaming and interconnectivity of gaming platforms are likely to affect device purchases in the coming year. There is an opportunity for consumers to opt for phones with lower specifications. As cloud gaming increases its footprint, gamers will only need a steady, fast internet connection.
  • To counter the frequent churn due to higher boredom levels in casual games, more variety is now being introduced in these games. Game makers are investing in research, marketing campaigns and, more importantly, associating with the right players in the ecosystem.
  • Consumers are actively demanding the capability to play heavy-duty console and PC games on mobile platforms. This is a big opportunity for smartphone OEMs especially with growth in 5G connectivity.

Gamers and their Smartphones:

Top Specifications Considered in Gaming Mobiles Counterpoint Research
Source: Counterpoint Research

Gamers who are invested in heavy multiplayer graphics online games like PUB G make up a smaller portion of the pie in this region. Instead, games like Subway surfer, Mobile legends, Arena of Valor, Roblox and Free Fire are played the most.

Gaming companies are making sure that smartphone versions of their games are available and that the hardware requirements need not be too high to enjoy these games on the mobile phone. Multiplayer gaming platforms on mobiles are nascent in this region as of now but as the telecom sector advances, this gaming preference is set to grow.

5G and Gaming:

5G penetration into gaming will be a slow process for another 2-3 years, especially for major markets like Indonesia. While Singapore is leading the curve in 5G, Thailand and the Philippines are more capable of advancing with 5G in gaming. The future of cloud gaming and multiplayer mobile setups, however, is bound to remain bleak in this region as compared to the West.

The 5G share in monthly smartphone shipments is likely to reach well above 45% by the end of this year. Most gamers, whether casual or professional, will look to include 5G in their gaming experience, especially since there is growth in the smartphone version of games usually played on consoles and personal computers.

5G Smartphone Shipment Share and Forecast 2022 2023
Source: Counterpoint Research Southeast Asia Smartphone Tracker

The Future of Gaming

Though Southeast Asia has the highest number of gamers in Asia, it contributes the least revenue. The entry point of free games is a crowd puller, but gaming companies and developers are trying to have a stronger revenue model. Ecosystem players have focused on all segments of consumers and made sure that multiple platforms can cater to different demographics based on their convenience and motives. Mobile gaming in Southeast Asia is capable of not just increasing gamer volumes and revenue but also spreading across multiple sectors like retail, e-commerce and sports.

While gamers in Southeast Asia are spread across early teens to senior citizens, the 18-35 age bracket is the one contributing most to the maturing gamer ecosystem.

In the coming months, we will likely see more marketing initiatives on platforms, and gaming business models centered around profit generation, which could be through increased micro-transactions within free game offerings. OEMs, operators, and retail distributors will combine the gaming aspect much more with their offerings.

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Malaysia’s Smartphone, Telecom Ecosystem Looking for Much-needed Synergy

Malaysia’s smartphone market went through its seasonal dip in volumes in Q1 2022, but there were other factors at play as well. According to Counterpoint Research’s Southeast Asia Monthly Smartphone Tracker, not only did Malaysia’s smartphone shipments fall 9% QoQ in Q1 2022 but also dropped 27% YoY, which is notable. Apart from factors like supply constraints, COVID-19 resurgence and drop in tourism revenues, the decline can also be attributed to issues related to 5G spectrum allocation.

Malaysia Shipments and Influencing Factors

5G Conundrum

Malaysia is going through an extended negotiation phase in the telecom sector. The two sides here are the government and the four main operators in the Malaysian telecom landscape – Maxis BHD, Celcom Axiata BHD, Digi Telecommunications and U Mobile. These four operators have recently requested a review of the government’s 5G access offer as they want at least a 51% stake in the government-owned 5G agency DNB. They are also looking for a review of the access offer with regard to the pricing plan and network access plan offered by the government. Cost and transparency seem to be a concern here, while control and profit are at stake.

While the government and operators continue to re-pitch propositions and cement their stance on the government-run 5G model, other segments of the industry and consumers are making sure their interests are not affected. OEMs continue to launch 5G smartphones in a country where digital transformation is in full swing, with 28% of smartphone shipments in Q1 2022 coming from 5G-compatible models.

5G Status in Southeast Asia

Economy

With a 5% YoY GDP growth in Q1 2022, the country is riding high and promising to show further growth on account of high domestic demand, consistency in external demand and an improved labour market. While the retail industry and offline channels have opened, the manufacturing sector has grown in the first quarter as well. There would have been an added layer of excitement leading to higher achievements had the 5G situation not escalated over the past 18 months. Industrial propulsion is thus limited due to the absence of 5G use cases.

Covid Effect

The country was reeling under its worst COVID-19 resurgence in the second half of Q1 2022, which handicapped a big portion of the offline channel dynamics, leading to much lower shipments. However, April onwards, the country is seeing relaxation in curbs on not only domestic movement but also international travel policies. If supply constraints reduce, we may see much better Q2 and Q3 on account of pent-up demand.

Consumer Front

A big portion of the Malaysian smartphone-using population is tech-savvy. Many consumers have already transitioned to using e-commerce, e-banking, e-finance, digital and social marketing, and other platforms. There are several actively growing consumer sub-genres in the form of gamers, power users, consumers switching from feature phones, and more. At this point, there is a growing frustration as the people have access to 5G devices, they have the know-how and are motivated, but still can’t access 5G. The lack of 5G infrastructure and commercialization is limiting Malaysia’s growth potential in a very important sector — technology.

The Malaysian smartphone market is promising for the region and its consumer base is one of the most versatile with regard to technology. The 5G situation, however, needs to catch up with government and industry momentum. The coming months may see higher volumes for the smartphone market, but it will see an overall development only when 5G is commercialized.

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Thailand Smartphone Shipments Grow 3% YoY in 2021; OPPO Takes Top Spot

  • Thailand’s smartphone market saw a flattish 3% YoY growth in 2021. Shipments bounced back in Q4 2021 to meet YoY levels after a low-performing Q3 2021.
  • OPPO led the market with a 20.5% share, followed by Samsung at 18.6%. Both were big on marketing campaigns and online offers.
  • Xiaomi, realme, Apple, Infinix and OnePlus all achieved their highest shipments ever in Thailand.
  • Online channel share was 26% in Q4 2021, the highest compared to the neighboring SEA countries like Indonesia, Philippines and Vietnam.
  • 5G compatible devices made up 40% of Thailand’s total smartphone volumes in 2021.

 Hong Kong, London, Boston, Toronto, New Delhi, Beijing, Taipei, Seoul – February 17, 2022

Thailand went through a challenging time in 2021 with COVID-19 and subsequent economic effects taking a toll on consumer spending habits and overall market sentiments. According to Counterpoint Research’s Southeast Asia Monthly Smartphone Channel Share Tracker, Thailand smartphone shipments grew 3% YoY in 2021 driven by increased 5G transition, more digital transformation in Tier II and Tier III towns and an all-time-high increase in e-commerce purchases.

Talking about the smartphone brands and their performance in 2021, Senior Analyst Glen Cardoza said, “Xiaomi invested comparatively less in marketing initiatives but was one of the brands that achieved the highest shipments ever due to its launches, partnerships in channels and association with ecosystem players like operators. Apple managed much higher volumes in Q4 2021 after the iPhone 13 series’ launch, crossing even the 2020 levels. realme did well with online festive sales and had good YoY growth in Q4 2021. Infinix performed much better on online sale days. Being an online-centric brand, Infinix has aggressively made its presence known on most e-commerce sites.”

Top OEMs Market Share in Thailand 2020 vs 2021

Source: Counterpoint Research Southeast Asia Monthly Smartphone Channel Share Tracker, December 2021

The smartphone industry had a good first half in 2021 but Q3 pulled down the shipment levels for most brands due to high COVID-19 infection rates. Supply constraints increased in H2 2021, but brands made sure that Q4 had enough inventory with most channel partners. On the country’s economy, Cardoza said, “Thailand’s tourism industry has always been a major revenue generator, but it has consistently taken a hit over the last two years. Consumer buying behavior has been volatile over 2021. As the year went by, there were worries of declining consumer purchasing power. In contrast, due to Q3 restrictions, Q4 was able to utilize the benefits of pent-up demand. At the same time, the government’s digital economy initiatives did not stop. It made sure that broadband networks continued to expand in all regions and tech expertise reached major industries like healthcare and manufacturing, with the integration of 5G use cases in the pipeline. Even tourism started seeing an increase in domestic visitors. Q4 2021 was a bounce-back for most OEMs with regards to smartphone shipments but brands like Xiaomi slipped in rankings due to acute supply issues.”

Top OEMs Market Share in Thailand Q4 2020 vs Q4 2021

Source: Counterpoint Research Southeast Asia Monthly Smartphone Channel Share Tracker, December 2021

The transition to 5G has been a consistently strong trend in this country. Q4 2021 alone saw 49% of shipments coming from 5G smartphones. All main OEMs, led by Apple, vivo and OPPO, actively launched 5G smartphones through 2021. Just like the 5G trend, online shipment share grew much more towards the last quarter as compared to any year. Online shipments increased 27% in 2021 and most of this increase came in H2 2021.

In 2021, more cohesiveness was seen between operators, retail offline channels and e-commerce players, giving a big push to OEM volumes. Moreover, foreign investments continued to pour into Thailand, showing faith in the country’s growth strategy. In 2022, we should see tougher competition between the top five brands. There is also a possibility of increased shipments in the low- and mid-tier price bands as long as component constraints do not hamper production.

Market Summary:

  • Samsung was in a tight contest with OPPO in 2021. The brand coordinated with all its operator and retail partners to make sure that not only mid- and premium-end devices were promoted well but also their low-tier partners, including the A series, which worked so well for Samsung through the year. In marketing, Samsung’s partnership with South Korean band BTS was notable.
  • OPPO saw an 11% dip in overall shipments in 2021 but still managed to lead the market by a very slim margin with Samsung. OPPO’s Reno series did well in H2 2021
  • Online share of shipments hit 26% in Q4 2021, which is the highest for any quarter in Thailand. This means many more consumers opted to purchase their smartphones online due to factors like cost, offers and convenience.
  • In Q4 2021, 5G smartphones made up 49% of the country’s smartphone shipments, with the iPhone 13 series launch pushing the numbers.

Note: Xiaomi includes Redmi, POCO and Mi sub-brands. OPPO includes OnePlus.

Feel free to contact us at press@counterpointresearch.com for questions regarding our latest research and insights.

Background:

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.

Analyst Contacts:

Glen Cardoza

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