It has been a well-known fact that the global smartphone market is maturing and the shipment volume has found its turn.
The decline is real and accelerating.
…first quarter of 2019 (1Q19) with shipment volumes down 6.6% year over year…
Smartphone vendors shipped a total of 310.8 million units in 1Q19, which marked the sixth consecutive quarter of decline. In 2018, smartphone shipments dropped 4.1% over 2017, which was inclusive of a first quarter that was down 3.5% – just half of what the market experienced in 1Q19.
While top performers are still trying to grab market shares (some go for higher ASP targeting market shares in terms of revenue; others go for value targeting market shares in terms of shipments), they have designed their way to grow upon/out of smartphones.
Apple will go for services. [Read more from a previous post]
Meanwhile, Xiaomi, long being tagged as “the Apple of China”, is aiming the IoTs.
I would like to say the IoT focus is making Xiaomi more unique than its phone business.
As of March 2018, we (Xiaomi) had over 100 million connected devices (excluding smartphones and laptops)
…the largest consumer IoT platform globally according to iResearch
And the segment grows fast in throughout 2018, and still maintained 56.5% growth rate in 2019 Q1.
Some of its items have risen fast into the go-to choice in those categories, such as Mi Air Purifier, Mi Band, etc.
In November 2018, Xiaomi announced a strategic partnership with IKEA. IKEA’s full range of smart lighting products will be connected to Xiaomi’s IoT platform starting this December in China.
In January 2019, Xiaomi announced taking a 0.48% stake in TV manufacturer TCL, deepening an existing alliance that saw the two work together to integrate Xiaomi’s operating system into TCL products. [Techcrunch]
Another number – MIUI MAU is constantly adding ~17-19 million each quarter.
| 17Q1 | 17Q2 | 17Q3 | 17Q4 | 18Q1 | 18Q2 | 18Q3 | 18Q4 | 19Q1 | |
| MIUI MAU (millions) | 138.3 | 146.0 | 156.5 | 170.8 | 190.0 | 206.9 | 224.4 | 242.1 | 260.9 |
| incremental (millions) | 7.7 | 10.5 | 14.3 | 19.2 | 16.9 | 17.5 | 17.7 | 18.8 |
Overall speaking, I think the IoT revenue should be around 30% for 2019 and may stay between 35-40% in the future.
At the same time, geographically speaking, Xiaomi is one of those companies that are benefitted the most from India’s growth.