OPPO (including OnePlus since Q3 2021) posted -17% YoY decline by smartphone shipments in Q2 2022, along with an ASP drop. Volume decline and the soft ASP combined dragged down OPPO’s wholesale revenue.
OPPO is facing headwinds in both home market and overseas markets, making the vendor’s outlook in 2022 gloomy.
In domestic market, OPPO is facing strong headwinds. The rising covid cases and the tightening lock-down measures combined have blowed China smartphone market in Q2 2022. Our Smartphone Country Share Tracker service tracked that China smartphone market contracted -14% YoY this quarter. OPPO’s shipment in domestic market dropped -29% YoY, vastly underperforming the overall market. This indicates that in addition to covid-related challenges, OPPO is facing the intensified competition in Android camp. The covid-related disruption is likely to continue in the second half of 2022, along with other unfavoured market conditions such as the intensified competition from Honor and the weakening demand in mass market. We have further lowered our forecast on China smartphone market in 2022 and project it will decline -10% to -11% YoY in 2022. Considering that China market contributed to almost half of OPPO’s total shipments this quarter, the vendor’s overall performance in 2022 is capped.
In overseas markets, OPPO is encountering other challenges. The regulatory uncertainties in India and the increasing IPR risks in mature markets are the two biggest ones. India is OPPO’s largest overseas market. After Xiaomi and vivo, OPPO is facing alleged tax evasion (USD 550 million) from India authority in July. This suggests the deteriorating business environment for Chinese vendors doing business in the country. Meanwhile, OPPO lost to Nokia in patent infringement in Germany recently. The sales of OPPO-branded and OnePlus-branded devices are currently banned in the country. OPPO and OnePlus are likely to be forced to exit the market because of the ruling. Considering Germany is the headquarter of OPPO’s Western Europe business, OPPO’s overall outlook in the region is under the shadow.
Our latest report Q2 ’22: OPPO: Smartphone Shipment and ASP Tumbled was published. WSS clients could access the full report via this link.
Meanwhile, we have employed SA Lens to evaluate vendors and compare them with their peers. Below is the evaluation on OPPO’s performance in Q2 2022.
