Canalys·2025-05-19 05:05Core Insights - The Southeast Asian smartphone market experienced a 3% year-on-year decline in Q1 2025, marking the first drop after five consecutive quarters of growth [1][2] - Samsung regained the top position with a shipment of 4.3 million units, holding a 19% market share, while Xiaomi was the only top five vendor to achieve year-on-year growth, increasing shipments by 4% to 4 million units, capturing 17% market share [1][7] - The average selling price (ASP) rose by 5% to its highest level since 2023, driven by a wave of high-end product launches in Q4 2024, which reduced disposable income for retailers [2][4] Market Dynamics - The decline in the smartphone market is attributed to high inventory levels due to preemptive stocking by manufacturers in Q4 2024, coupled with inflationary pressures that weakened consumer demand, particularly in the entry-level and mid-range segments [2][4] - Manufacturers are advised to maintain flexible product portfolio strategies to adapt to changing market dynamics, as demonstrated by Xiaomi's strategic acceleration of Note series launches [2][5] Competitive Landscape - Honor achieved an impressive 88% year-on-year growth, with shipments reaching 893,000 units, attributed to a diverse product line that mitigated reliance on a single market segment [2][5] - Samsung's focus on enhancing product value and deepening partnerships with telecom operators has led to a 47% year-on-year increase in shipments of its 5G A series, aiding its transition towards a higher-end product line [2][5] Regional Insights - Vietnam is emerging as a key beneficiary of regional supply chain shifts, supported by stable governance and improved infrastructure, making it an attractive location for long-term smartphone production investments [5] - Other Southeast Asian countries like Malaysia, Indonesia, and Thailand are also enhancing their roles in the smartphone value chain, leveraging local advantages in semiconductor and battery production [5]