According to the report, many people in China (that can afford it) already have smartphones, and it's now maturing and moving to an upgrade market.

The world’s largest smartphone market doesn’t have much room left to grow.

Smartphone shipments in China fell 4.3% in the first quarter compared with a year ago for the first time in six years, according to a new survey set to be released on Monday by International Data Corp. Rival surveys show continued growth during the quarter, but at much slower levels than previously.

Experts say the slowdown is largely driven by the disappearance of China’s first-time buyers. Smartphones now have a more than 90% penetration rate in China, said Tom Kang, research director with market-research firm Counterpoint, meaning just about everybody in China who wants a smartphone already has one. “China is now a replacement market,” Mr. Kang said. IDC: Q1 Smartphone Shipments in China fell 4.3pct [wsj.com]