In terms of the shipments of smartphone application processors (AP) in China, downstream vendors started early inventory preparation in the fourth quarter of 2016 resulting in higher supply chain inventory levels. AP orders dropped significantly after the Chinese New Year, with some handset brand makers even asking to defer AP shipments to a large extent.
Taiwan's presence in the global handset market continues to shrink. Its share of global shipments is expected to drop below 2% in the first quarter of 2017.
Digitimes Research estimates overall fourth-quarter 2016 shipments from China-based smartphone firms were 181.8 million units with an on-quarter increase of 4.4% and an on-year increase of 12.8%.
The notebook market has been showing signs of recovery, with Taiwan makers seeing their first on-year shipment growth since first-quarter 2012 in fourth-quarter 2016.
Digitimes Research estimates that 2016 was another down year for the global notebook market, with shipments dipping below 150 million. While the market will continue shrinking in 2017, the drop will be much less dramatic, as Windows 10 adoption in the enterprise will drive corporate demand. This Digitimes Special Report examines key factors in the notebook industry, including products, vendors and ODMs, that will affect total shipments in 2017 and through 2021.
Digitimes Research expects global application processor (AP) shipments to increase more than 8% in 2017 and surpass the 1.9 billion mark, with smartphones remaining the main application. After slumping in 2015, Qualcomm returned to form in 2016 and will continue leading the market in 2017, as other players continue playing catch up and scramble for funds to invest in more diverse applications such as IoT and other smart end-device applications.
Smartphone shipments in the China market reached 112.3 million units in the third quarter, up 5.8% on year and 5.2% on quarter. China-based telecom carriers continued to offer subsidies to encourage existing 2G or 3G service users to switch to a 4G service and thus created strong demand for inexpensive 4G smartphones.
Digitimes Research estimates shipments of AP for smartphones and tablet PC in China in the fourth quarter of 2016 will show a growth of 11.6% on quarter.
Taiwan handset makers had a disappointing third quarter in 2016 as a result of decreased ODM orders and low-than-expected performances of Taiwan's brand vendors.
Taiwan-based notebook makers saw significant increases in their shipments in the third quarter of 2016, as clients prepared for the year-end holiday shopping season. The fourth quarter will also mark the first time they have seen on-year shipment growth in four years.
