China's smartphone shipments fell to 66 million units in the second quarter, marking five straight quarters of decline. While Huawei and Apple saw growth due to stable pricing, other major Android brands faced sharp drops after raising costs to combat inflation in component prices.
The Chinese smartphone market remains under pressure as total shipments fell 4.3% year-on-year to 66 million units during the second quarter of 2026. This data, reported by industry analysts at IDC, highlights a continued cooling in demand, marking the fifth consecutive quarter of negative growth for the sector. When looking at the first half of the year, total shipments are down 4.2% compared to the same period in 2019, suggesting that the industry has not yet found a bottom.
While the broader market struggled, the performance gap between top-tier players and their competitors has widened significantly. Huawei Technologies and Apple were the only major vendors to record positive growth, with shipment increases of 19.4% and 24.4%, respectively. This growth is largely credited to their ability to maintain stable pricing strategies. By avoiding the price hikes seen elsewhere, these companies successfully captured demand from consumers who were otherwise delaying phone upgrades.
Market share data reflects this divide in consumer preference. Huawei maintained its top position with a 22.6% share of the market, while Apple followed in second place with an 18.1% share. In contrast, other major Android manufacturers faced significant headwinds. Xiaomi, for instance, recorded a 21.7% decline in shipments, while Oppo and Vivo saw their shipments drop by 9.7% and 11.4%, respectively.
Analysts point to rising costs for essential components—specifically memory chips—as the primary trigger for the market-wide instability. To protect their profit margins, many Android brands chose to increase handset prices or discontinue lower-priced models. This move backfired by further discouraging price-sensitive buyers in a cooling economy. Additionally, the reduction of government subsidies, which had historically supported domestic demand, has left consumers with less incentive to replace their older devices.
For investors, the key monitorable remains whether consumer demand can recover in the coming quarters or if manufacturers will be forced to continue absorbing higher component costs at the expense of their margins. The reliance on stable pricing as a growth engine highlights how sensitive the current market is to price changes, and companies that are unable to manage supply chain costs without passing them on to consumers may continue to face pressure on their shipment volumes.