Competition in Smartphone Camera Intensifies, but Autos and Headsets Are Bright Spots

China-based Sunny Optical’s revenue and earnings are largely derived from manufacturing camera lenses and modules. Before 2015, lower-margin modules, as well as glass lenses for digital single-lens reflex cameras, made up the majority of Sunny’s earnings, however, the fortuitous acquisition of Konica Minolta’s China optical lenses business in April 2014 allowed the company to break into the plastic lenses segment. Since then, Sunny’s market share in the handset lenses segment has increased significantly, and it is now the largest player by shipment volume. This strong growth coincided with the ascension of China’s smartphone brands, namely Huawei, Oppo, Vivo, and Xiaomi, which make up more than half of Sunny’s revenue.