In recent years, innovation in the mobile phone market has stagnated, and the frequency of replacing phones has decreased. The market space has grown slowly. In the future, AI will bring more abundant mobile phone application functions. Generation models and intelligent assistants significantly improve efficiency, and the mobile phone market is expected to usher in a new round of replacement cycles.
Zhongtong Finance App learned that Shanxi Securities released a research report stating that innovation in the mobile phone market has stagnated in recent years, the frequency of phone replacement has decreased, and the market space has grown slowly. In the future, AI will bring more abundant mobile phone application functions. Generation models and intelligent assistants significantly improve efficiency, and the mobile phone market is expected to usher in a new round of replacement cycles. The launch of new phones by Samsung, VIVO and others in the Android market has received a positive response from the market. Since the release of the new iPad by Apple, subsequent products have successively been equipped with AI functions. The upgrade of the iOS system at the WWDC indicates the direction of AI phone development. The release of Apple's new phones in the second half of the year will continue to strengthen the trend towards AI phones.
At the Apple WWDC release, the focus was on Apple Intelligence, and Apple will fully productize AI.
Based on mainstream AI applications and mobile phone AI products, Apple Intelligence emphasizes the functionality brought by AI, summarized and refined as Powerful, Intuitive, Integrated, Personal, Private. By improving user efficiency through smart interaction and combining with native apps, multiple angles and functions can be quickly interacted and responded to. AI is used as a powerful logical reasoning tool to achieve productization. The functional entry Siri will be fully upgraded, and the new generation of Siri will be able to achieve stronger information understanding and APP collaborative interaction capabilities. Specific functions include intermittent conversation, screen perception, image generation, text processing, etc. At the same time, openAI is introduced, and the latest cloud model GPT-4o is installed to realize the mode of jointly inferring the end-side + private cloud + external model access. This accelerates the rapid formation of the AI application ecology.
Android brands are striving to make their phones more AI-centric, and flagship Android phones will be fully AI-based in the second half of the year.
According to Counterpoint Research, the global market share of smartphones with GenAI functionality in 1Q24 has increased to 6%, a significant increase from 1.3% in the previous quarter. Among them, the Samsung Galaxy S24 series accounted for 58%, and the penetration rate of AI-enabled smartphones has continued to increase. It is expected that Qualcomm, MediaTek, and others will continue to launch new flagship chips this year, further promoting the AIization process of the Android market. Each manufacturer on the model side has developed independent edge-end model products, such as VIVO's Blue Heart Large Model and OPPO's Andes Large Model. The trend towards AIization of mobile phone applications is accelerating with the upgrade of software and hardware coordination.
Key companies to watch: Apple's AI process is accelerating, speeding up phone replacement, and the Apple industry chain is expected to start a new round of cycles. It is recommended to pay attention to Avary Holding (002938.SZ), Luxshare Precision Industry (002475.SZ), Suzhou Dongshan Precision Manufacturing (002384.SZ), Lens Technology (300433.SZ), Zhejiang Crystal-Optech (002273.SZ), etc.
Risk warning: The development of the AI industry is slower than expected; the repair of downstream consumer electronics prosperity is slower than expected; supply chain is affected by trade friction slower than expected.