In recent years, the biggest trend of smartphone camera modules is the increasing number of rear camera modules, according to TrendForce’s investigations. According to TrendForce research, triple camera modules surpassed dual camera modules to become mainstream in 2020 and drove the continued growth of smartphone camera module shipments. Annual smartphone camera module shipments in 2022 are expected to reach 4.92 billion units, or 2% growth YoY.

However, the trend towards multiple cameras started to shift in 2H21 after a few years of positive growth. The previous spike in the penetration rate of four camera modules was primarily incited by mid-range smart phone models in 2H20 when mobile phone brands sought to market their products through promoting more and more cameras. However, as consumers realized that the macro and depth camera usually featured on the third and fourth cameras were used less frequently and improvements in overall photo quality limited, the demand for four camera modules gradually subsided and mobile phone brands returned to fulfilling the actual needs of consumers. In addition, increases in the pricing of semiconductor chips such as PMICs and Driver ICs, as well as increased shipping costs, have driven the cost of mobile phones up sharply. Without the ability to effectively pass this cost onto consumers, any remaining allowance to economically install low-end cameras has been effectively eliminated.

Camera resolution upgrades: fastest growing market share encompasses 49-64 million pixel cameras

Although camera shipment growth has slowed, camera resolution continues to improve. Taking primary cameras as an example, the current mainstream design is 13-48 million pixels, accounting for more than 50% of cameras in 2021. In second place are products featuring 49-64 million pixels which accounted for more than 20% of cameras last year with penetration rate expected to increase to 23% in 2022. The third highest portion is 12 million pixel products, currently dominated by the iPhone and Samsung’s flagship series. However, a 48 million pixel primary camera is expected to be introduced to the iPhone 14 Pro series (tentative name) that Apple will release this year, further reducing 12 million pixel products to a 15% share in 2022.

In addition to the original Samsung and Xiaomi brands employing 108 million pixels cameras, Vivo and Honor also introduced similar resolution cameras in 2021. There is a chance 200 million pixel products will be ready for commercial use in 2022, driving the penetration rate of ultra-high pixel products to an expected level in excess of 5% in 2022. However, such ultra-high pixel products primarily focus on enlarging photographs without losing image quality. Therefore, TrendForce believes that any marginal benefits these products bring to consumers will gradually decrease and the penetration rate will not grow as quickly as 49-64 million pixels products.

Overall, TrendForce believes that the number of camera modules mounted on smartphones will no longer be the main focus of mobile phone brands, as focus will return to the real needs of consumers. Therefore, triple camera modules will remain the mainstream design for the next 2~3 years.

For additional insights from TrendForce analysts on the latest tech industry news, trends, and forecasts, please visit our blog at https://insider.trendforce.com/

The smartphone market is showing an improvement in demand during the second half of this year due to the peak season for e-commerce promotional activities and the easing of COVID-19 outbreaks in regions such as Southeast Asia, according to TrendForce’s latest investigations. However, there have been significant shortages of components including 4G SoCs, low-end 5G SoCs, display panel driver ICs, etc. The persistent component gaps are constraining smartphone brands from raising device production for the second half of the year. Looking at 3Q21, the quarterly total smartphone production came to around 325 million units, a 5.7% QoQ increase. Even so, not only does the QoQ increase in smartphone production for 3Q21 fall short of the QoQ increase for the same quarter last year, but the quarterly production volume for 3Q21 also shows a weaker performance result when compared with figures from 3Q20 or from 3Q19, prior to the emergence of the pandemic.

As for the total production for the whole 2021, TrendForce has lowered the projection to 1.335 billion units with a YoY growth rate of 6.5%. The previous projection was 1.345 billion units with a YoY growth rate of 7.3%. This downward correction mainly reflects the impact of the component gaps on device production. Going forward, an important point of observation in the smartphone market is whether the pandemic will further weaken demand. Also, the other significant variables that will influence future smartphone demand include geopolitical tensions, distribution of production capacity in the foundry market, and global inflationary pressure.

While smartphone production for 3Q21 reached about 325 million units, the release of new models helped Apple retake second place in the global ranking

Samsung raised its smartphone production by 17.9% QoQ to 69 million units for 3Q21. The growth was mainly attributed to the stabilization of the capacity utilization rates of its device assembly plants in Vietnam. Samsung continued to top the global ranking of smartphone brands with the largest market share in production terms. Apple released four new iPhone models under the iPhone 13 series in 3Q21. Thanks to their contribution, the total iPhone production for 3Q21 registered a QoQ increase of 22.6% to 51.5 million units. With this result, Apple was also able to climb to second place in the global ranking. In terms of product development, Apple is staying with the plan to release its third-generation iPhone SE in 1Q22 and four models under a new series in 2H22. The third-generation iPhone SE is expected to be a major instrument in helping Apple establish a presence in the market segment for mid-range 5G smartphones. Its production volume for 2022 is forecasted to reach 25-30 million units.

OPPO marginally raised its smartphone production by 3% QoQ to 51 million units for 3Q21, thereby capturing third place in the ranking. Xiaomi held fourth place as its smartphone production for the same quarter fell by 10% QoQ to 44.5 million units. Vivo’s smartphone production for 3Q21 was relatively constant compared with the previous quarter, coming to around 34 million units. With this result, Vivo was ranked fifth. The production figures of these three Chinese brands include devices under their respective sub-brands (i.e., OPPO’s Realme and OnePlus; Xiaomi’s Redmi, POCO, and Black Shark; and Vivo’s iQoo). Looking at the three brands’ production performances in 3Q21, TrendForce notes that there is a high degree of overlap in terms of target market as well as a high degree of similarity in offerings. Hence, their production performances directly hinge on their ability to acquire enough of the components that are now in short supply.

Honor will expand into the overseas markets next year as part of its plan for a comeback

After spending the first half of this year stocking up on components and undergoing business restructuring, Honor is now on a more solid footing and will attain an annual smartphone production of 43.5 million units. In the global ranking of smartphone brands by annual production for 2021, Honor is expected to take eighth place. Also, Honor as an independent brand has obtained access to Google Mobile Services. Therefore, it plans to expand to other markets outside China next year and leverage the sales expertise that it has acquired from Huawei in order gain a bigger share of the overseas markets. Regarding Honor’s sales strategy as a whole, the main focus is still on the domestic market. As for the overseas markets, Honor will continue Huawei’s strategy and avoid India where competition revolves around low pricing. Instead, Honor will attempt to establish itself in regions such as Russia, the wider Europe, and South America. In general, Honor’s rise will likely affect the market shares of the other aforementioned brands. How much market share Honor will gain depends on its ability to have sufficient inventory of components that are now in short supply.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

Apple’s latest AirPods 3 still feature an optical in-ear detection mechanism, according to TrendForce’s 2021 Infrared Sensing Market Trend – 3D Sensing, LiDAR, SWIR LED report. Through the integration of PPG (photoplethysmography) technology, the AirPods 3 contain an improved in-ear detection mechanism based on skin-detect sensors that are equipped with four SWIR (short-wave infrared) LED chips that have two different wavelengths, as well as two InGaAs photodiodes. Industry insiders indicate that the AirPods 3’s skin-detect sensors may potentially detect the water content in the wearer’s skin, giving them the ability to differentiate between human skin and other surfaces. TrendForce expects annual AirPods shipment for 2022 to reach 85 million sets, a 3.7% YoY increase.

While the demand for these end-products rises, the relevant suppliers will stand to benefit as a result. Such companies include SWIR LED chip suppliers Epistar and DOWA; InGaAs photodiode suppliers DOWA and II-VI/Finisar; and module assembler USI.

SWIR wavelengths range from 1,050-2,500 nm, which encompasses the optical properties of compounds such as water, sugar, and alcohol. While SWIR technologies gradually mature, and prices begin to reach feasible levels, wearables manufacturers are expected to officially integrate SWIR technologies into their products in 2H21. With improvements in their algorithm, wearables are increasingly likely to feature PPG-based biosensing functions, which can measure not only heart rate and blood oxygen levels, but also other variables including body hydration as well as blood glucose, blood lipid, and blood alcohol levels in the future.

For more information on reports and market data from TrendForce’s Department of Optoelectronics Research, please click here, or email Ms. Grace Li from the Sales Department at graceli@trendforce.com

Apple is set to unveil the successors to its current device lineups at this year’s fall product launch on September 14. Please see below for some of TrendForce‘s latest data pertaining to the global consumer electronics market:

1. Although the tight supply of certain components due to complications resulting from the COVID-19 pandemic remains Apple’s primary production-related challenge, iPhone production will unlikely be drastically affected. Total iPhone production for 2021 is expected to reach 229.5 million units, a 15.6% YoY increase, with the upcoming iPhone 13 models accounting for about 37%-39% of Apple’s annual iPhone production. In addition, iPhones are also expected to account for about 77% of total annual production of 5G smartphones in 2021, making them the market leader in this segment and representing a drastic increase from 39% in 2020.
2. Regarding technical specifications, the Pro model of iPhone 13 is expected to include 1TB storage capacity as an optional upgrade. Other improvements over previous models include the adoption of A15 processors manufactured with TSMC’s 5nm+ process technology. All four iPhone 13 models will feature flexible AMOLED + On-cell designs for their display panels, while the Pro series will also feature a 120Hz refresh rate as well as LTPO technology for reduced power consumption. Furthermore, all four models’ primary cameras will be equipped with sensor shift image stabilization. The Pro model, in particular, will have its ultra-wide camera upgraded to a 6P lens, with the addition of autofocus capability as well. Much like the iPhone 12, LiDAR functionality is available only for the Pro model of the iPhone 13 lineup.
3. In view of the lackluster sales performances of the iPhone 12 mini, which reached EOL ahead of time, the iPhone 13 mini is expected to account for less than 10% of total iPhone 13 production, since Apple will focus its sales efforts on the other three models. TrendForce indicates that the global economy, markets, and personal incomes are all still experiencing the effects of the COVID-19 pandemic, which has also led to price hikes for electronic components and transportation services, thereby compounding Apple’s difficulties in setting retail prices for the new iPhone models. TrendForce expects Apple to continue the aggressive pricing strategy that it adopted for last year’s models in order to attract smartphone buyers, raise its revenue from services via increased handset sales, and make up for the aggressive prices via increased service revenue.

（Cover image source: Apple official website）

The iPhone 13 series, which is about to be formally announced by Apple, has already had its exterior design speculated on by various media outlets and fans alike. TrendForce’s latest investigations indicate that some of the notable hardware upgrades of the iPhone 13 pertain to the SoC (manufactured at the 5nm+ node, which enables improved performance and decreased power consumption), display, and camera. In addition, iPhone handsets featuring support for 5G mmWave will be available for sale in more countries after the release of iPhone 13.

The iPhone 13 will see a shift in its charging circuit board from the previous rigid-flex PCB design to a new design featuring SiP combined with flexible PCB. The space-saving feature of this new design will also likely result in increased battery capacity. As for retail prices, the iPhone 13 series is expected to remain similar to the iPhone 12 series assuming Apple is able to effectively control manufacturing costs, since the latest models do not come with significant hardware upgrades. As a result of this aggressive pricing scheme, iPhone shipment will likely maintain its growth trajectory for two consecutive years.

Huawei’s plight led to Apple’s rising market share in the Greater China region

Owing to heavy competition from Chinese brands, sales in the Greater China region accounted for a decreasing share of Apple’s iPhone revenue, from 19.44% in 2017 down to merely 16.33% in 2020. Nevertheless, this downtrend has been gradually reversing since 4Q20, primarily because of increased sanctions against Huawei.As Huawei was cut off from its chip supply in 4Q20, shipment of Huawei smartphones underwent a massive decline accordingly, in turn leaving vacancies in the flagship smartphone market in China. At the same time, while Apple released its new iPhone 12 models, flagship smartphone buyers in China began purchasing iPhones instead. Thanks to this shift, sales in the Greater China region began accounting for a growing share of Apple’s iPhone revenue, from 14.8% up to 19.13% in 4Q20. Since 4Q20, this figure has remained above 18% for three consecutive quarters.

Prior to being sanctioned by the US government, Huawei had enjoyed the highest market share in the high-end smartphone segment in China. After the sanctions were put into place, this segment then became highly sought after by other smartphone brands. However, because other Chinese brands had not previously placed significant emphasis on the high-end market, the iPhone was able to seize most of the market share in the high-end segment left in Huawei’s wake. Furthermore, although other Chinese smartphone brands have started developing their respective flagship models, it takes considerable time to build up their brand images in this segment and attract customers. TrendForce therefore believes that the iPhone will continue to dominate the high-end smartphone market in China for the next two to three years.

iPhones are expected to account for 16.7% of global smartphone shipment in 2021

An overview of iPhone shipments for the past few years shows that iPhone shipment went into a nosedive starting in 4Q18 because the iPhone XS/XR series featured limited improvements yet a significant price hike over its iPhone 8/X predecessor. Alarmed by this decline, Apple immediately revamped its sales strategy for the next-gen iPhone 11, which not only underwent a total overhaul in terms of specs but also experienced a price cut of US$50 for the entry-level model (the Pro model retained its previous-gen equivalent’s price). Apple subsequently released the brand-new iPhone SE in 2020, thereby reversing the downward trajectory of iPhone shipment as a result.

New iPhones saw a deferred released schedule in 2020 owing to the impact of the COVID-19 pandemic, which led to a 14% YoY decrease in iPhone shipment for 3Q20. However, as the new iPhone 12 models equipped with across-the-board hardware upgrades, including 5G functionality, were released in 4Q20, iPhone shipment saw a massive rebound during the quarter and reached a 12% YoY increase in 4Q20 and a further increase of 42% YoY in 1Q21.

Looking ahead to the shipment volumes of the new iPhone models for 2H21, TrendForce expects Apple to maintain its aggressive pricing strategy in order to boost shipment. In addition, as the iPhone 13 series will once again return to a September release, total iPhone shipment is expected to undergo a 30% YoY increase in 3Q21, but a 5% YoY decrease in 4Q21. As such, iPhone sales for 2H21 will likely surpass 2H20 figures. For 2021, iPhones are expected to account for 16.7% of all smartphone shipment, which is a step-up compared to last year.

（Cover image source: Pexels）