5G Offsets Covid-19 Weakness
The global smartphone applications processor (AP) market once again defied the COVID-19 pandemic and grew 20 percent in revenue terms to $5.8 billion in Q2 2020, according to Strategy Analytics’ Handset Component Technologies (HCT) service report.
According to this Strategy Analytics’ research report “ Smartphone Apps Processor Market Share Tracker Q2 2020: 5G Drives Revenue Surge ” from Strategy Analytics, Qualcomm , HiSilicon , Apple , MediaTek , and Samsung LSI captured the top-five revenue share spots in the global smartphone applications processor (AP) market in Q2 2020. Qualcomm maintained its lead of the smartphone AP market with a 32 percent revenue share, followed by HiSilicon with 22 percent and Apple with 19 percent.
- Strategy Analytics estimates that smartphone AP shipments declined 16 percent year-on-year in Q2 2020, driven by COVID-19-led weakness. However, increased mix of higher-priced 5G APs more than offset this weakness and helped the AP market to register 20 percent year-on-year revenue growth.
- Smartphone APs with on-device artificial intelligence (AI) registered strong growth even as the total market declined and accounted for 70 percent of total smartphone APs shipped in Q2 2020, up from 48 percent in Q2 2019. Top-selling smartphone AI APs include Apple A13 Bionic, Qualcomm Snapdragon 765/G and HiSilicon Kirin 990.
- Stand-alone AP shipments grew 36 percent as vendors such as Qualcomm and Samsung used stand-alone AP approach to address the flagship 5G market in 2020.
Sravan Kundojjala , Associate Director at Strategy Analytics, commented, “Despite a shipment decline, Qualcomm saw significant strength in its smartphone AP ASPs (Average Selling Prices), thanks to 5G. Qualcomm’s smartphone AP ASP reached their highest in the last six years. 5G-attached APs accounted for over 35 percent of Qualcomm’s total smartphone AP shipments in Q2 2020, per Strategy Analytics’ estimates. As we predicted in our Q1 2020 report, MediaTek overtook Qualcomm in terms of integrated AP shipments but Qualcomm retained the overall smartphone lead in units and revenues. Strategy Analytics estimates that Qualcomm still has a sizeable lead over MediaTek in revenue terms.”
Stephen Entwistle , Vice President of the Strategy Analytics Strategic TechnologiesPractice, added, “The Coronavirus (COVID-19) impact was visible on the smartphone AP market as shipments declined 13 percent year-on-year in 1H 2020. The smartphone supply chain including foundries and AP vendors held up well and ensured steady supply, especially in high growth segments such as 5G. We believe that the worst is over now and that 2H 2020 will witness good growth compared to 1H 2020, driven by new flagship and mid-range 5G device launches including the iPhone 5G.”
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