UBS: 1Q26 China home appliance off-season retail sales weak, still cautious on the sector
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UBS: 1Q26 China home appliance off-season retail sales weak, still cautious on the sector
The report believes that 1Q26 retail sales of China's white goods and most small appliances weakened due to subsidy roll-off, a high base and competition, but demand may stabilize in 2H26; structurally, it is more positive on Midea and continues to flag cost pressure for smart devices.
- 1Q26 all-channel white-goods retail sales fell by roughly 4%-25% y/y, mainly due to the 1Q25 high base and the fading of subsidy effects.
- Gree's air conditioner share rose by 2/1 percentage points y/y online/offline; Haier's washing machine share rose by 5/1 percentage points y/y online/offline.
- Online retail sales of robot vacuums fell 14% y/y, but Roborock's online floor-washer sales rose 53%, and its share increased by 9 percentage points to 22%.
- Insta360 global/China app downloads grew 73%/167% y/y in 1Q26, indicating strong shipment growth.
- UBS expects average prices in 2026 to remain broadly stable or edge higher, as copper price increases drive industry price hikes, but costs, tariffs and the exchange rate remain pressure points for smart-device margins.
Report interpretation
Overview
This report focuses on the retail performance of China's home appliance industry in 1Q26. Based on AVC retail data, UBS Evidence Lab and Sensor Tower app data, UBS judges that the sector was in the off-season in 1Q26, with weak sales in white goods and most small appliances. The main reasons were the fading of subsidy benefits, a high base from the same period last year, and limited Q1 promotional力度 from leading brands. The report also points out that demand may stabilize in 2H26, and average prices could stay stable or rise thanks to higher copper prices and industry-wide price increases.
Core views
UBS maintains a cautious stance on China's home appliance sector. In white goods, Midea remains the relatively preferred name, while Gree stays rated Sell. In smart devices, ArashiVision and Anker are Neutral, with UBS mainly concerned that tariffs, RMB appreciation and rising component costs will weigh on margins. By subcategory, traditional white-goods retail weakened, online sales of robot vacuums declined on a high base, but Roborock stood out in floor washers; most small kitchen appliances remained weak, with only online pressure cookers and soy milk makers showing slight growth.
Analysis framework
The report mainly combines retail tracking, brand-share changes, online/offline channel splits, app download data and a valuation-risk framework. AVC data is used to measure retail sales, volumes and average price changes across appliance categories; UBS Evidence Lab and Sensor Tower data are used to observe app-download trends related to smart hardware such as Insta360; and valuation work uses SOTP, DCF or PE multiple methods depending on the company.
Methodology notes
app download and usage data
UBS uses Sensor Tower app analytics data to track iOS and Google Play app rankings and download estimates across more than 90 regions, helping to assess company performance and mobile app strategy.
tracking appliance retail sales, volumes, average prices and market share
The report uses AVC data to break out online and offline channels and compare the year-on-year changes in 1Q26 for air conditioners, washing machines, refrigerators, range hoods, robot vacuums, floor washers and small kitchen appliances.
company-level valuation framework
Midea and ArashiVision use SOTP-related frameworks, Gree uses DCF, and Anker uses PE multiples; the report also lists upside and downside risks for each.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- Midea GroupLeading white-goods player and UBS's preferred name
- Strengths
- A relatively complete product and brand portfolio; UBS is relatively positive on Midea within white goods.
- Weaknesses
- 1Q26 online air-conditioner share fell 3 percentage points y/y.
- Comparison
- It has stronger channel and sub-brand competitiveness than Xiaomi and other new entrants, but Gree has gained share in air conditioners.
- Risks
- Tighter property policy may weigh on home appliance demand, RMB volatility may lead to FX losses, and slower global robot market growth may affect related businesses.
- GreeAir conditioner leader, rated Sell
- Strengths
- In 1Q26, air conditioner share rose by 2/1 percentage points y/y online/offline, and KINGHOME's online share improved sequentially.
- Weaknesses
- Demand across the sector remains weak, and UBS keeps a Sell rating on the company.
- Comparison
- Its air conditioner share performance is better than the change in Midea's online air-conditioner share.
- Risks
- Upside risks include more trade-in subsidies, favorable weather in the peak season, lower raw-material prices and higher-than-expected dividends.
- HaierMajor washing machine and refrigerator brand
- Strengths
- In 1Q26, washing machine share rose by 5/1 percentage points y/y online/offline, while refrigerator share was stable.
- Weaknesses
- The overall white-goods retail environment remains weak.
- Comparison
- Its washing machine share improvement is better than most white-goods peers.
- Risks
- Weak property and consumer demand, rising raw-material prices and intensifying competition.
- XiaomiWhite-goods new entrant / competitor
- Strengths
- It has a consumer-electronics ecosystem and an online-channel foundation.
- Weaknesses
- In 1Q26, online white-goods share continued to erode, with air conditioners, washing machines and refrigerators down 5, 7 and 3 percentage points respectively.
- Comparison
- Compared with leading home-appliance brands, it is being squeezed by sub-brands with stronger pricing competitiveness.
- Risks
- Intensifying white-goods competition, insufficient price-tier coverage and continued channel-share decline.
- RoborockRobot vacuum and floor-washer brand
- Strengths
- Robot vacuum online share rose 3 percentage points y/y to 28%; floor-washer online sales rose 53% y/y, and share increased to 22%.
- Weaknesses
- The overall robot vacuum online retail market fell 14% y/y, with clear high-base pressure.
- Comparison
- Robot vacuum share is close to Ecovacs' 29%, and floor-washer performance is significantly better than the market average of -6%.
- Risks
- Competition intensifying due to new entrants, rising raw-material prices and FX volatility.
- EcovacsLeading player in online robot vacuum share
- Strengths
- In 1Q26, robot vacuum online share was 29%, up 3 percentage points y/y.
- Weaknesses
- The overall robot vacuum online market it operates in declined y/y.
- Comparison
- Share is slightly higher than Roborock's 28%.
- Risks
- Market competition, rising raw-material prices and demand fluctuations after a high base.
- DreameCompetitor in robot vacuums
- Strengths
- Online share was still 14% in 1Q26.
- Weaknesses
- Share fell 1 percentage point y/y.
- Comparison
- Share is below Ecovacs and Roborock.
- Risks
- Intensifying competition and slower category growth.
- ArashiVision / Insta360Smart devices and action-imaging related name
- Strengths
- In 1Q26, Insta360 global/China app downloads grew 73%/167% y/y, signaling strong shipment growth.
- Weaknesses
- UBS rates ArashiVision Neutral and flags uncertainties related to costs and overseas expansion.
- Comparison
- It has strong app-download momentum within smart devices, but margins are still constrained by costs.
- Risks
- Demand weaker than expected, intensifying competition, slower-than-expected ramp of new products, slower-than-expected global expansion, higher costs and FX losses.
- AnkerSmart devices / consumer electronics accessories name
- Strengths
- It has growth opportunities in new categories and overseas markets.
- Weaknesses
- UBS rates it Neutral, believing tariffs, component costs and exchange rates may weigh on margins.
- Comparison
- It shares UBS focus with ArashiVision within smart devices, and both face cost and overseas market risks.
- Risks
- Demand weaker than expected, price competition at home and abroad, slower-than-expected ramp of products or new categories, higher tariffs or component costs, and FX losses.
Key data
- 1Q26 all-channel air conditioner retail salesdown about 25% y/yDerived from a 14% decline in offline air conditioner sales and a 35% decline in online air conditioner sales, mainly due to a high base and subsidy roll-off.
- 1Q26 all-channel washing machine retail salesdown about 4% y/yOffline down 11%, online up 3%.
- 1Q26 all-channel refrigerator retail salesdown about 7% y/yOffline down 11%, online down 3%.
- 1Q26 all-channel range hood retail salesdown about 13% y/yOffline down 24%, online down 2%.
- Gree air conditioner shareup 2/1 percentage points y/y online/offlineKINGHOME's online share rose from 3% in 4Q25 to 5% in 1Q26.
- Haier washing machine shareup 5/1 percentage points y/y online/offlineRefrigerator online and offline shares were basically stable y/y.
- Xiaomi white-goods online shareair conditioners -5 percentage points, washing machines -7 percentage points, refrigerators -3 percentage pointsThe report believes this was mainly due to competition from sub-brands with stronger pricing competitiveness among leading brands.
- 1Q26 robot vacuum online retail salesdown 14% y/yVolumes down 19%, average price up 6%; a high base is an important backdrop.
- Roborock floor-washer online salesup 53% y/ySignificantly better than the market average of -6%, with value share rising 9 percentage points to 22%.
- Insta360 app downloadsglobal/China up 73%/167% y/yUBS believes this signals strong shipment growth.
Impact & implications
At the industry level, short-term demand is still constrained by subsidy roll-off, a high base and weak consumer sentiment, so companies are more reliant on share gains, sub-brand price-tier positioning and price increases to offset cost pressure. For investors, white goods require close monitoring of whether demand stabilizes in 2026 2H and how copper prices affect average prices and gross margins; for smart devices, the key is to assess the impact of tariffs, exchange rates, component costs and overseas expansion pace on profitability.
Risks
- Tighter China property policy or a weak property market may weigh on home appliance demand.
- Higher raw-material prices, especially copper, may erode industry margins.
- Global supply-chain constraints and tariff changes may affect China's home appliance and smart-device exports.
- RMB exchange-rate volatility may lead to FX losses.
- More new entrants in robot vacuums and small appliances may intensify price competition.
- Weak consumer sentiment may result in demand falling short of expectations.
What to watch
- Whether China's home appliance demand stabilizes in 2026 2H.
- Whether trade-in and other government subsidy policies are extended or increased.
- How copper prices and key component prices affect average prices, gross margins and promotional intensity.
- The impact of peak-season weather on air-conditioner demand.
- Changes in online and offline share for brands such as Midea, Gree, Haier and Xiaomi.
- Share competition among Roborock, Ecovacs and Dreame in robot vacuums and floor washers.
- Whether Insta360 global and China app downloads can sustain high growth.
- The impact of tariffs, RMB exchange rates and overseas demand on margins at smart-device companies such as Anker and ArashiVision.