Shipments of smartphones within China jumped 236 percent annually to 21.3 million handsets in January, according to the China Academy of Information and Communications (CAICT), a state-backed think tank.
That was up from 6.3 million in February 2020 and higher than the 14.9 million in February 2019, suggesting China’s smartphone sector has returned to its pre-pandemic levels.
Manufacturing glitches and a lagging consumer economy marred China’s smartphone sector as COVID-19 spread in early 2020, but the industry has largely recovered along with the broader economy.
Despite the pandemic’s retreat in China, handset brands now face production issues due to a global computer chip shortage.
A confluence of factors including demand miscalculation, unexpected factory shutdowns, and U.S.-China tensions caused a number of automobile companies to report chip sourcing issues in late December.
That shortage has since spread to many types of chips and all types of hardware, including smartphones.
In late February, Xiaomi Corp VP Lu Weibing posted a brief message on Chinese social media calling the chip crunch “an extreme shortage.”
Xiaomi was one of several Chinese handset makers that ramped up production late last year in anticipation of strong sales as U.S sanctions kneecapped the ability of Huawei Technologies Co Ltd to make handsets.
Analysts consider that ramp up as one of several key factors that contributed to the shortage.