China’s robot vacuum market has been eerily silent in the Double Eleven shopping festival that has just passed.
The two industrial leaders, Ecovacs (科沃斯) and Roborock (石头科技), surprised many by ceasing to publish sales data for Double Eleven, or Singles Day, this year, known as China’s equivalent of Black Friday.
Release of sales numbers on this occasion, where millions of merchants offer sizeable discounts on merchandise to drive sales, has been a practice that repeated itself annually — until this year.
The lull in disclosure on the part of Ecovacs and Roborock, which together grab a domestic market share of more than 50%, has called their financial well-being into question.
This is partially borne out by their rout in China’s stock market.
In the third quarter of this year, Ecovacs, once likened to the liquor brand Moutai because of its strong profitability, posted a stunning 92% slump in its net profit.
Its shares edged up 0.05% today to end at 45.99 yuan (US$6.31) apiece, with a market cap of 26.70 billion yuan, about 35% less than at the beginning of this year.
Stock market rout
Tumbling stock prices have led to at least more than 100 billion yuan being pared off its market value.
Roborock, an arch rival, did not fare any better. Its shares have slid almost 80% from an all-time high. Multiple large shareholders chose to cut their stake in the company.
As of today, Roborock closed 0.43% higher to 299.69 yuan per share, with a market cap of 39.4 billion yuan.
Latecomers closing in on leaders
Surprisingly, Narwal (云鲸智能) and Dreametech (追觅科技), latecomers to the robot vacuum scene, have been catching up fast.
Narwal said on November 11 that its GMV for the Double Eleven shopping gala totaled 350 million yuan, up 31% over a year earlier across online and offline retail channels.
Dreametech for its part announced the following day that online and offline sales exceeded 2.1 billion yuan, an increase of a whopping 100% year on year.
Despite their strong growth, this doesn’t signify a fundamental shift in the market landscape, according to investor Chen Le, who tracks the ups and downs of the domestic robot vacuum industry.
Before the next cycle of tech iteration arrives, the landscape is poised to remain unchanged, he added.
AVC, an online market data service provider, indicates that China’s robot vacuum cleaner market was divided in 2022 among Ecovacs, Roborock, Narwal, Xiaomi and Dreametech, with a corresponding share of 39.8%, 21.28%, 15.01%, 9.47% and 6.98%.
Nonetheless, Ecovacs and Roborock do face a lackluster growth outlook, Chen, the investor, explained.