Gree Electric, one of China’s biggest air-conditioner makers, has denied a media report claiming it disbanded its core smartphone team.

According to a report by Chinese media source Jiemian, Gree, located in the southern Chinese city of Zhuhai, has dissolved the core team of its smartphone company, which at its peak employed 100 workers in the southern tech metropolis of Shenzhen.

In response to rumors that its smartphone staff had been terminated, the Zhuhai-based firm stated that research and development for Gree smartphones was "ongoing", adding that customers are welcome to buy and experience its sixth-generation smartphone Tosot G7.

Gree initially revealed its plans for smartphones in 2015, when chairwoman Dong Mingzhu, one of China's most well-known businesswomen, claimed that Gree could "easily surpass" Xiaomi in the smartphone industry.

Dong also bragged that Gree handsets were just as excellent as iPhones from US tech giant Apple during a shareholder meeting in June of last year.

However, the home appliance manufacturer's phones still haven't become widely used, and failed to keep up with the pace of technological updates.

The official Gree website for its smartphone products is currently inaccessible, and there are just two smartphone models available for purchase on the main Gree website. Gree's WeChat public account for its smartphone business has not been updated since April 2020, and the company's 2022 annual report makes no mention of its smartphone division.

The struggling smartphone division of the electronics giant is being hit by ongoing market challenges in China.

According to IT industry research firm Canalys, smartphone shipments in China dropped 11% in the first quarter to their lowest level in ten years. According to the data, which was released last month, Chinese smartphone shipments decreased to 67.6 million units, the lowest shipment total for the March quarter since 2013.