Author: Li Jun
Lei Jun, founder of millet group W (01810.HK), had previously said that white household appliances would be fully developed in 2019. This is interpreted by the industry as a comprehensive challenge to the industry status of Gree Electric Appliances (000651.SZ), Mei Group (000333.SZ), Qingdao Haier (600690.SH).
Entering the Year of Pig, Lei Jun's ambition is not only Dalian Telecom, but also Jinjia (002191.SH) announcement, which inadvertently disclosed the news of cooperation with Xiaomi into the electronic cigarette industry.
Behind all this, millet group's smartphone shipments grew by only 1.4% year-on-year in the fourth quarter of 2018, which is in sharp contrast to the annual sales growth of more than 30% year-on-year; millet even fell by nearly 15% year-on-year in the fourth quarter, less than 30 million units. Can Lei Jun relied on new products such as electronic cigarettes to overcome his difficulties after launching all-round power generation and red rice mobile phones?
Mobile phone shipments fell by nearly 15% year-on-year.
Entering the air-conditioning, washing machine and other household appliances industry in an all-round way, and now even making articles on electronic cigarettes, all of which are behind the slow growth of smartphone sales, many brands have seen negative growth in shipments. Millet mobile phones also showed fatigue in the fourth quarter of 2018, and there is an urgent need to find new growth points.
Although it raised nearly HK$30 billion in July 2018 and has been vigorously expanding its marketing efforts, the sales of millet mobile phones fell to the fifth place in the world in the fourth quarter of 2018, an increase of only 1.4% year on year. In the whole year of 2018, millet delivered 122.6 million units, with a market share of 8.7% ranking fourth in the world and a growth rate of 32.2%.
In early February, IDC released a report on the global smartphone market in the fourth quarter of 2018, which showed that the top three were Samsung, Apple and Huawei respectively; OPPO was the fourth, with shipments of 29.2 million units, an increase of 6.8% year-on-year; Millet Group was the fifth, with shipments of 28.6 million units, an increase of 1.4% year-on-year, and the fourth quarter of millet shipments had lagged behind OPPO.
However, Millet's strategy of moving into high-end mobile phones did not seem to work in the fourth quarter, with shipments falling by nearly 15% in the fourth quarter compared with the third quarter. Although it remained fourth in the year 2018, with sales of 126 million units, its global market share was 8.7%, which was also lower than that of third-place Huahua, which was 14.7%.
The global smartphone market has fallen for five consecutive quarters due to longer switching cycles, lack of exciting models and adverse economic winds. According to IDC data, global smartphone shipments fell by 4.1% year-on-year in 2018, totaling 1,404.9 million units, the first year-on-year decline in the global smartphone market in history.
An electronics industry analyst, who did not want to be named, told First Financial Journalist that sales of millet mobile phones in the fourth quarter were sluggish, mainly because sales of mid-and high-end mobile phones were not as expected. Competitor Huawei launched several new products in the third and fourth quarters of last year, while Apple recently took price-cutting measures to grab market share. The future of millet mobile phones is still not optimistic.
In early February, Canalys, a market research institute, released the shipment data for the smartphone market in China for the whole year of 2018. According to the report, the Chinese market experienced the sharpest decline in shipments in 2018, with annual shipments of 396 million units, down more than 14% year-on-year, and the overall market size dragged back to pre-2014 levels. In the third and fourth quarter of 2018, the fourth millet had a bottleneck in growth, making its annual output less than 50 million units, down 6% from the previous year, but with the overall market shrinking, its market share rose slightly to 12%.
Hand in Hand Jinjia Stock to Enter Electronic Cigarette Industry
Due to the slump in mobile phone sales, Lei Jun urgently needs to find new growth points. After the large appliances with relatively high gross profit margin, the lucrative electronic cigarette is likely to become the next growth point.
According to the above-mentioned electronic industry analysts, there is a need for more explanations on how to balance the interests of the related transactions between the senior executives of the millet group and the millet eco-chain company.
In addition, where is Wu Mao, the main shareholder of rice science and technology, sacred? Industry and commerce information shows that Wu Mao is the legal representative of three enterprises, in addition to rice science and technology, there are Shenzhen Dianxiu Technology Co., Ltd., Kunshan Xinchuang Electronics Co., Ltd.
About the cooperation with Jinjia Stock, a person close to Millet Group told First Financial and Economic Journalist that because Weiwei Science and Technology is an ecological chain enterprise of millet, which mainly operates independently of itself, it is not clear whether it will be sold in Millet house stores in the future.
The people close to the millet group said that in the future, millet will continue to work hard mainly in household appliances and red rice, striving for breakthroughs. In the past, the rapid growth of mobile phones and televisions in millet was mainly due to the gradual withdrawal from the market of such brands as Le Video, Jinli and Cool Piece, which was filled by millet. After that, there will be more uncertainties about the growth of mobile phones.
According to Zhang Yidong, an analyst at Societe Generale Securities, domestic smartphone shipments fell 15.5% in 2018 from a year earlier, and may continue to decline in 2019. The business of Millet Group can be logically divided into two groups, one is the sales of mobile phones and TV, and the related Internet value-added income; the other is the income of other IoT products and related commodity e-commerce. Millet Group is in the stage of increasing the new and old kinetic energy conversion.