Mobile phone shipments in China fell sharply in May 2025, according to the China Academy of Information and Communications Technology (CAICT). A total of 23.716 million units were shipped, representing a 21.8% decrease from the same period last year.

Of the total shipments, 5G smartphones accounted for 21.19 million units, a decline of 17.0% year-on-year. Despite the decrease, 5G devices made up 89.3% of all mobile phones shipped during the month.

Market analysts attribute the decline to factors such as market saturation, economic uncertainties, and changing consumer preferences. This data underscores the challenges facing China’s mobile phone industry as companies adapt to a shifting market landscape.

🔗 Source: 36Kr

🧠 Food for thought

1️⃣ China’s smartphone market follows cyclical patterns with predictable consolidation

The current 21.8% decline is part of a historical pattern in China’s smartphone market that alternates between growth and contraction phases.

China experienced its first market decline in 2017 (4% drop) after eight consecutive years of growth, followed by a more severe 14% contraction in 2018 when shipments fell to 396 million units, their lowest level since 20131.

During each contraction phase, market consolidation intensifies. In 2018, the top five vendors increased their combined market share from 73% to 88%1, suggesting smaller players are disproportionately affected during downturns.

This pattern of consolidation has continued into 2025, with major players adapting through strategic product differentiation and channel optimization to navigate challenging market conditions.

The cyclical nature of China’s smartphone market indicates that current declines, while significant, are part of an established pattern rather than an anomaly. This suggests potential stabilization in future quarters.

2️⃣ Extended replacement cycles fundamentally restructured market dynamics

The sharp decline in May 2025 shipments reflects a long-term structural shift in consumer behavior that began around 2017-2018 when replacement cycles first started lengthening significantly.

As early as 2018, analysts identified that Chinese consumers were keeping smartphones longer, with average device lifespan extending to 26.8 months2, transforming what was once a “change market” into a “stop market.”

This shift was driven by consumers’ perception that existing devices remained sufficient for their needs. Canalys analyst Mo Jia noted in 2018 that growth would likely not resume until 5G devices were introduced2.

While 5G devices now dominate (89.3% of May 2025 shipments), they haven’t reversed the fundamental trend of consumers extending the useful life of their devices.