Research insights
China smartphone AP shipments increase in 3Q20, says Digitimes Research
Stella Weng, DIGITIMES Research, Taipei

Shipments of smartphone-use application processors (AP) to China, including those for handset exports, grew 13.4% sequentially but declined 9.5% on year to 192.6 million units in the third quarter of 2020, Digitimes Research has found.

The sequential growth comes as Huawei rushed to stock up APs from MediaTek prior to the US imposing fresh trade bans, and other Chinese brands were also ramping up smartphone shipments to India for inventory replenishments by channel operators there.

MediaTek managed to maintain its top AP vendor ranking with a 44.9% share in the third quarter, up 6.6pp from a quarter earlier. Qualcomm was second with its share standing flat at 37% and HiSilicon Technologies saw its share slip 8.8pp to 13%.

Despite off-peak season effects, smartphone AP shipments to China are expected to only edge down 0.9% on quarter and 2.8% in fourth-quarter 2020, as non-Huawei Chinese brands ramp up shipments to expand their market shares at the expense of Huawei, Digitimes Research estimates.

While blocked from shipping 5G APs to Huawei in the fourth quarter by the US trade sanctions, MediaTek's shipments of 4G APs will also be constrained by the tight supply of power management (PWM) ICs, undermining its market share.

Qualcomm is expected to outrace MediaTek to become the top smartphone AP vendor in China in the fourth quarter as it will be less affected by the US trade bans, having not yet begun shipping any 5G APs to Huawei. Qualcomm will start ramping up production of both entry-level and high-end 5G APs.

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