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Report: Smartphone Sales Swing up Following Decline

Smiling people using smart phones

Worldwide shipments of smartphones grew 1.3 percent, year over year, in the first quarter of 2018 following a decline in sales the previous quarter, according to a new report from Gartner.

Smartphones made up 84 percent of the total mobile phone market, accounting for nearly 384 million of the 455 million units sold. Much of that good news came at the low end of the market, however.

"Demand for premium and high-end smartphones continued to suffer due to marginal incremental benefits during upgrade," said Anshul Gupta, research director at Gartner, in a prepared statement. "Demand for entry-level smartphones (sub-$100) and low midtier smartphones (sub-$150) improved due to better-quality models."

Samsung led the market with 78.56 million shipments, good enough for 20.5 percent of the market. Both numbers are slightly down, however, over the 78.78 million shipments and 20.8 percent share the company tallied in the same period last year.

"Samsung's mid-tier smartphones faced continued competition from Chinese brands, which led to unit sales contraction year on year. This is despite the earlier launch of its flagship Galaxy S9/S9+ compared to the S8/S8+ in 2017, and despite the Note 8 having a positive impact on Samsung sales in the first quarter of 2018," according to information released by Gartner. "Samsung's smartphone growth rate will remain under pressure through 2018, with Chinese brands' growing dominance and expansion into Europe and Latin America markets. Samsung is challenged to raise the average selling price (ASP) of its smartphones, while facing increasing competition from Chinese brands that are taking more market share."

In second place, Apple saw some year-on-year growth, boosting shipments from 51.99 million in last year's fist quarter to 54.06 million in the most recent quarter. The company's market share improved fro 13.7 percent to 14.1 percent.

"Even though demand for Apple's iPhone X exceeded that of iPhone 8 and iPhone 8 Plus, the vendor struggled to drive significant smartphone replacements, which led to slower-than-expected growth in the first quarter of 2018," said Gupta, in a prepared statement. "With its exclusive focus on premium smartphones, Apple needs to significantly raise the overall experience of its next-generation iPhones to trigger replacements and lead to solid growth in the near future."

Huawei held the third spot with 40.43 million sales for a 10.5 percent slice of the market, an improvement from its 34.18 million sales in the same period last year, when it captured 9 percent of smartphone sales.

"Achieving 18.3 percent growth in the first quarter of 2018 helped Huawei close the gap with Apple," said Gupta, in a prepared statement. "However, its future growth increasingly depends on the vendor ramping up share in emerging Asia/Pacific and resolving issues in the U.S. market, through the development of a stronger consumer brand. Huawei's attempt to grow its premium smartphone portfolio with its recent launches of the P20, P20 Pro and Honor 10 helps raise its competitiveness and growth potential."

Xiaomi overtook Oppo for fourth place, with shipments more than doubling from 12.71 million during the first quarter of 2017, when the company held just 3.4 percent of the market, to 28.5 million sales in the first quarter of this year. The company's market share has improved to 7.4 percent to start the year.

"Xiaomi was the clear winner of the first quarter, achieving a growth of 124 percent year on year. Xiaomi's refreshed portfolio of smartphones and aggressive pricing strategy helped it hold the No. 4 spot in the first quarter of 2018," according to information released by Gartner.

Oppo saw a slight dip, falling from 30.92 million shipments and 8.2 percent of the market to start last year to 28.17 million sales and 7.3 percent of the market in the most recent quarter.

About the Author

Joshua Bolkan is contributing editor for Campus Technology, THE Journal and STEAM Universe. He can be reached at [email protected].

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