The global smartphone applications processor (AP) market surged 21% on year to US$6.8 billion in the first quarter of 2021, according to Strategy Analytics.
Qualcomm led the smartphone AP market with a 40% revenue share in the first quarter, followed by MediaTek with 26% and Apple with 20%, Strategy Analytics indicated.
"The trade war reshaped the global smartphone AP market in Q1 2021. Both Qualcomm and MediaTek made the most of HiSilicon's forced exit from the smartphone AP market due to trade restrictions. Both companies enjoyed a double-digit shipment growth in Q1 2021 and gained market share with their 4G and 5G APs," said Sravan Kundojjala, associate director of Strategy Analytics' handset component technologies service.
HiSilicon's smartphone AP shipments declined 88% on year in the first quarter of 2021, Strategy Analytics said. "It remains to be seen whether Huawei will spin-off HiSilicon's smartphone chip business to ensure its future."
"Apple, Samsung LSI and Unisoc also saw shipment and revenue growth in Q1 2021," Kundojjala continued. "The growth momentum will continue through 2021, driven by an increased mix of 5G-attached APs and post-pandemic demand."
Strategy Analytics, however, expressed caution smartphone AP vendors need to maintain healthy ASPs and optimize their cost structure in light of increasing chip development costs and foundry capacity constraints.
Of total smartphone APs shipped in the first quarter of 2021, 5G APs accounted for 41%, according to Strategy Analytics. Entry-level 5G APs such as Snapdragon 480 and Dimensity 700 will help smartphone manufacturers bring 5G to lower price tiers in 2021.