March China Mobile Tracker: Low-End Market Under Pressure, High-End ASP Continues to Rise
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March China Mobile Tracker: Low-End Market Under Pressure, High-End ASP Continues to Rise
March China smartphone shipments were flat year-over-year but down 23% month-over-month. Low-end models are hit hard by memory price increases, while high-end ASP rises 15%. Outperform ratings are maintained for MediaTek, Apple, and Xiaomi.
- March shipments of 19 million units, flat year-over-year, down 23% month-over-month
- Low-end model shipments fell 27% year-over-year, high-end grew 23%
- Smartphone ASP increased 15% year-over-year, driven by memory price increases and model cancellations
- Huawei high-end model wait times shortened but sales did not increase, possibly suggesting average performance of N+3 process
- MediaTek, Apple, Xiaomi receive 'Outperform' ratings, Qualcomm 'Market Perform'
Report interpretation
Overview
Bernstein released a tracking report on China's smartphone market for March 2026. The report points out that due to rising memory prices, the low-end market is under significant pressure, with the number of model cancellations hitting a historic low, yet the mid-to-high-end market continues to grow, driving overall ASP upward. The institution maintains 'Outperform' ratings for MediaTek, Apple, and Xiaomi, is optimistic about AI ASIC and high-end supply chain opportunities, but holds a cautious stance on full-year shipments.
Core views
In terms of total market volume and structure, March China smartphone sales were 19 million units, flat year-over-year, down 23% month-over-month. Cumulative shipments for the first three months of 2026 fell 6% year-over-year. The institution forecasts full-year 2026 China smartphone shipments to decline 15% year-over-year. Structurally, low-end model shipments (<2000 RMB) plummeted 27% year-over-year, while mid-range and high-end models grew 16% and 23%, respectively. ASP and memory costs: March smartphone ASP rose 15% year-over-year (January +13%, February +14%). The upward momentum came from cancellations of low-end models and price increases on same models (new models are on average 300-500 RMB more expensive than their predecessors). High memory prices continue to pressure low-end Android manufacturers, but high-end brands (Huawei, Apple) are less affected. Brand performance: Apple's March shipments grew 19% year-over-year, benefiting from the launch of the iPhone 17e and flexible pricing. Huawei's share increased, but wait times for high-end Pro Max models shortened without significant sales growth, suggesting that SMIC's 'N+3' process performance may have fallen short of expectations, lacking EUV competitiveness. Other Android OEMs (OPPO, vivo, Xiaomi, etc.) saw their combined share decline 3.1 percentage points year-over-year, dragged down by the low-end market. Supply chain and chips: MediaTek's share increased 2.1 percentage points month-over-month, benefiting from share growth by Xiaomi and Honor. Qualcomm faces memory cost pressures. Spreadtrum's share remains below 1%, indicating a lack of competitiveness in 5G. OLED penetration has reached 90% ceiling, with growth slowing.
Analysis framework
The report uses monthly sell-through tracking and sell-in data comparison to analyze inventory risk, combined with price band (low-end/mid-range/high-end) breakdowns to observe structural changes. High-frequency data such as wait times and new model launch counts are used to infer supply chain capacity and demand conditions. ASP changes are used to back-calculate memory cost pass-through and model mix adjustments.
Methodology notes
Analyzing market conditions through divergence in shipments and ASP
The report observes flat shipments but rising ASP, identifying it as a cost-driven structural upgrade rather than natural demand growth, helping to identify real demand weakness under inflation.
Breaking down shipments by price band to observe structural changes
Dividing the phone market into low-end, mid-range, and high-end price bands, and separately tracking sales changes, thus precisely pinpointing the impact of memory price hikes on the low-end market and the resilience of the high-end market.
Inferring process yield through wait times and sales relationship
Using the phenomenon of shortened wait times for high-end models without increased sales to indirectly infer that chip processes (such as N+3) may have performance bottlenecks, leading to limited demand rather than insufficient supply.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- MediaTek (2454.TT)Beneficiary
- Strengths
- Share increase, AI ASIC business growth expectations
- Weaknesses
- Overall smartphone shipments under pressure
- Comparison
- Outperforms Qualcomm, less affected by memory cost pressure
- Risks
- Uncertainty in overseas market demand
- Apple (AAPL)Beneficiary
- Strengths
- High-end market resilience, flexible pricing, no low-end exposure
- Weaknesses
- Limited growth in flagship segment
- Comparison
- Outperforms Android camp, less affected by memory price increase
- Risks
- Saturation in high-end demand
- Xiaomi (1810.HK)Beneficiary
- Strengths
- Share increase, successful cost pass-through
- Weaknesses
- High-end model sales declined year-over-year
- Comparison
- Performs relatively well among Android camp
- Risks
- Drag from low-end market
- Qualcomm (QCOM)Neutral
- Strengths
- Data center business expectations
- Weaknesses
- Smartphone segment under memory cost pressure
- Comparison
- Faces competition from MediaTek
- Risks
- Phone sales miss expectations
- HuaweiNeutral
- Strengths
- Share increase, self-developed chips
- Weaknesses
- N+3 process performance may have fallen short of expectations
- Comparison
- Competes with Apple in high-end segment
- Risks
- Supply chain constraints, chip performance
Key data
- March Shipments19 million unitsMonth-over-month -23%, Year-over-year 0%
- Low-end Model Shipments Year-over-Year-27%Most affected by memory price increases
- High-end Model Shipments Year-over-Year+23%Maintaining growth resilience
- March ASP Year-over-Year+15%Rising for three consecutive months
- Number of New Model Launches15 modelsHistorical average 40 models, hitting a historic low
- MediaTek Share Month-over-Month Change+2.1pptBenefiting from share growth of Xiaomi and Honor
Impact & implications
Memory price increases accelerate industry consolidation, benefiting top-tier manufacturers with high-end pricing power. Supply chain inventory risk is manageable, with sell-in and sell-through data close. The AI smartphone upgrade cycle has not fully started, but the ASIC business is expected to support rapid growth starting from Q4 2026.
Risks
- Continued rise in memory prices
- High-end demand below expectations
- Geopolitical impact on supply chain
- Delay in AI smartphone upgrade cycle launch
What to watch
- Low-end model cancellations in subsequent months
- Changes in Huawei high-end model sales
- Launch of AI smartphone upgrade cycle
- Memory price trends