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IDC: Smartphone assembly volumes grew 11.9% in Q2 2019

Smartphone assembly volumes increased by 11.9% quarter over quarter during the 2Q19, according to the latest result of IDC (International Data Corp.) Worldwide Smartphone ODM Qview.

Total shipments reached 332.6 million and IDC attributes this to the decrease in inventory covering the period of 1Q19 and vendors competing for market share.

“Falling inventory combined with increased competition caused global smartphone production to increase 11.9% (QoQ) in 2Q19,” said Sean Kao, senior research manager with IDC’s Worldwide Smartphone ODM Research Group. “However, a more pessimistic outlook on the global economy due to the US-China trade war has led to a production drop in June. As a result, worldwide smartphone assembly shipment volumes showed a year-over-year decrease of 3.5%.”

IDC’s report further states that due to ODM (original design manufacturer) policy and partner changes from Huawei, OPPO, and Xiaomi, the ranking and market share of Chinese EMSes have improved significantly. The market share of Chinese smartphone ODM/EMS assembly shipment volumes increased from 40.7% in 1Q19 to 51.3% in 2Q19.

However, the industry analyst firm predicts that the July and August figures would slow down when the results come citing Samsung and Huawei lowering their regional market targets, combined with high inventory, as well as the effects of the US-China trade war.
The object of IDC’s Worldwide ODM and Display Research is the compilation of manufacturers who provide ODM and EMS services to their clients — branded vendors. The ODM/EMS manufacturers are in the upstream of the industry supply chain, marked by the red tab in Figure 1. ODM/EMS manufacturers include Foxconn, Huaqin, Compal, Quanta, Compal, Wistron, and others. Their clients are branded or white-box vendors, such as Apple, Amazon, Lenovo, Huawei, OPPO, and others.