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Coronavirus Outbreak May Halve China's Smartphone Sales in First Quarter: The Lessons Learned and Re



The Coronavirus outbreak is expected to lead to a huge reduction in the production of smartphones, potentially falling by as much as 30% in first-half 2020, reckons market advisory firm ABI Research.


Unsurprisingly, sales of household cleaning and disinfectant products saw huge growth. Dettol and Lysol owner, Reckitt Benckiser, saw U.S. sales of cleaning wipes surge over 100% in the first three months of the year, compared to a year earlier and up 60% in the second quarter, with continued momentum into the third quarter with sales +19%. Aerosol disinfectant sales are up over 100% so far this year, climbing +120% in the third quarter, while dishwasher detergents and general kitchen cleaner sales are also up by around 40%.




Coronavirus Outbreak May Halve China s Smartphone Sales in First Quarter



Henkel, parent company of brands such as Persil and Schwarzkopf, saw U.S. hand soap sales climb by around 60% in the first half of the year and see continued demand into the third quarter, up 33%, with October sales +23%.


As the pandemic took hold, health conscious consumers also loaded up on vitamins and supplements throughout the year. Reckitt Benckiser saw U.S. sales climb around 50% in the first half of the year with continued support in the third quarter (+26%).


The pandemic has pushed more shoppers online, with e-commerce now accounting for 16.1% of all U.S. sales, up from 11.8% in the first quarter and this trend is likely to stick, even as brick-and-mortar stores open their doors again.


In many cases, the boom certain companies saw in e-commerce in the first half of the year offset slower parts of their business, leading them to rethink and invest in their e-commerce abilities in coming quarters. Reckitt Benckiser said along with professional hygiene and their Dettol and Lysol brands, online sales represented a core growth opportunity. E-commerce represented 12% of sales in the first six months of the year, growing over 60% with strong performance across digital channels, including direct to consumer sales and click and collect solutions.


Worldwide smartphone shipments dropped 11% the first quarter from a year earlier, led by Chinese brands Xiaomi, Oppo and Vivo, according to a report today by market research firm Canalys. Shipments fell to 311 million units from 347 million in the first three months of 2021.


Meanwhile, the U.S. anticipates lower imports from China. The last quarter of 2019 saw low imports, exports, and international trade. There is a risk of a sizeable negative demand shock if the public overreacts to the coronavirus outbreak.


South Korea was one of the first countries to experience a COVID-19 outbreak, with its first case, imported from Wuhan, China, reported on January 20, 2020 (see Figure 1). The government activated the Central Disaster and Safety Countermeasures Headquarters within days, and it has met daily since then, with the prime minister attending at least three times a week.11


The coronavirus-driven global shift to working from home is set to have boosted demand for Samsung Electronics' memory chips from laptop makers and data centres, but first-quarter profits are likely to remain flat as the outbreak weakened consumer electronics sales.


The South Korean tech giant is the world's largest memory chip maker, and its Galaxy smartphones are a major rival of Apple Inc's products.Samsung, which also makes home appliances and displays, on Tuesday releases guidance for the January-March quarter profit which is widely expected to be unchanged, and come under pressure in the next few quarters as the impact of coronavirus-related factory and retail stores shutdowns bites.


However, the company already warned last month that the pandemic would hurt sales of smartphones and consumer electronics goods this year, and analysts said a prolonged virus outbreak could put higher demand for memory chips at risk. ALSO READ: Samsung Galaxy S20 Plus review: Wholesome package justifies premium pricing


When the outbreak first started in China last year, Samsung's strategy of spreading out its production base to countries including Vietnam and India seemed to pay off: rivals such as Apple were hit by supply disruptions as China shut down factories and locked down cities to control the coronavirus.


Brokerage Hanwha Investment & Securities estimates Samsung smartphone sales fell 17% in the first quarter from a year earlier. Last year, a slump in profits at the smartphone and chip businesses more than halved Samsung's full-year earnings. 2ff7e9595c


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