Smartphone market contracts by 6% in Q1, shipping only 320 million units

Date: Thu, 04/28/2016 - 19:08 Source: Juniper Research

Apple reports first ever year-on-year decline of 16.3%. Lumia sales decline sharply, to less than 3 million units. Samsung continues to stabilise revenue, with slight increase in unit sales

Smartphone market contracts by 6% in Q1, shipping only 320 million units

Several vendors without a strong base in China are also suffering


Leading mobile analyst firm Juniper Research estimates that the number of smartphone shipments reached 320 million in Q1 2016, representing a year-on-year decline of nearly 6%.
Apple reported its first ever year-on-year decline in iPhone sales this quarter, attributed to the larger than expected success of the iPhone 6 range in 2015. With the latest 6S only offering incremental improvements on these designs, sales have returned to more usual growth patterns after the usual Q4 sales boost.
However, with economic problems in China, and Apple facing legislative opposition to its services there, future growth in this region is likely to be harder to achieve than in previous years.

China Sneezes, the World Catches a Cold
Xiaomi’s meteoric growth has slowed, to just over 14 million units shipped, a 1% decline on shipments compared to this time last year. Lenovo is estimated to have suffered a similar drop, shipping 15.9 smartphones this quarter.
Several vendors without a strong base in China are also suffering. Microsoft has posted its worst ever quarter for Lumia sales, at only 2.3 million units shipped. Similarly, Sony has experienced a 57% YoY decline, partly due to focusing on profitability over volume, but also due to the slowing market.

A Few Glimmers of Hope for Android
• Samsung has increased its revenue mix, stabilising its shipments but not giving a strong volume turnaround, at an estimated 83 million units shipped.
• Huawei is continuing its rise, with over 27 million devices shipped.
• BlackBerry’s woes continue, with an estimated 53% decline in units shipped, despite a pivot to Android with the Priv. Unless sales pick up in 2016, as more Android devices are released, we anticipate that BlackBerry will exit the smartphone market in the near future.

As the market as a whole slows, smartphone vendors need to adjust to targeting the replacement market. Large growth in other areas, such as Africa, is unlikely unless there is a dramatic reduction in the ASP (average selling price) of lower-end smartphones, meaning that the market decline will to continue throughout the year.

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