Global smartphone market falls for the fifth consecutive quarter

The global smartphone market decreased for the fifth consecutive quarter, falling 6.3 per cent to 362m in Q4 2018, according to the most recent Canalys Smartphone Analysis. Apple was the number one vendor of smartphones in Q4 2018, even after experiencing a -7.3 per cent annual growth from Q4 2017. Apple sold 71.7m iPhones in Q4, beating out Samsung who also dropped in sales, with an annual growth of -5.3 per cent, and sold 70.3m smartphones.

Although Apple took the lead in phones shipped within Q4, the full year of 2018 was won by Samsung, shipping 293.7m devices globally. Huawei, Oppo and Xiaomi finished the top five vendors of Q4, all seeing a positive annual growth compared to Q4 2017. Even with the annual growth of three major vendors, global smartphone shipments in 2018 totaled 1.4bn, down by 5 per cent compared to 2017’s 1.5bn total shipments.

“It is no shock to smartphone vendors that the market has passed its peak,” said Canalys senior analyst Ben Stanton, “People are clearly keeping phones for longer as product innovation slows. But the speed and severity of shipment decline has caught many vendors, investors, and other companies in the value chain off guard. International factors like the U.S-China trade war, weak consumer spending in developed markets, and a buoyant market for refurbished phones, have catalyzed the decline of smartphone shipments.”

Apple’s iPhone XR was the most popular iPhone of Q4, with over 22m shipments globally, followed by the iPhone XS Max and iPhone XS. However, the tech giant’s popularity continues to shrink, especially in core markets like China, most likely due to competition from Samsung and Huawei, who both offer cheaper alternatives.

While Apple and Samsung both falling short of their respective shipping goals, Huawei jumped by 47 per cent in annual growth in Q4. Huawei also pioneered new technology in 2018, leading to record market share in China and a 60 per cent increase in shipments overseas. Canalys predicts major challenges for all three vendors in the year to come, including political hurdles, pricing, and the rise of aggressive competitors.