Smartphone sales suffer first-ever global decline

SmartphonesGlobal smartphone sales fell by 5.6 per cent in the fourth quarter of 2017, the first time the market has seen a year-on-year (YoY) decline since tech research firm Gartner began tracking it all the way back in 2004.

“Two main factors led to the fall in the fourth quarter of 2017,” said Anshul Gupta, research director at Gartner. “First, upgrades from feature phones to smartphones have slowed down due to a lack of quality ‘ultra-low-cost’ smartphones and users preferring to buy quality feature phones. Second, replacement smartphone users are choosing quality models and keeping them longer, lengthening the replacement cycle of smartphones.

“Moreover, while demand for high quality, 4G connectivity and better camera features remained strong, high expectations and few incremental benefits during replacement weakened smartphone sales.”

During Q4 2017, Chinese smartphone makers Huawei and Xiaomi were the only two of the top five vendors to experience growth – of 7.6 per cent and 79 per cent respectively. Meanwhile, Samsung held on to top spot, despite a 3.6 per cent decline in YoY sales, ahead of Apple, which saw iPhone sales fall by five per cent.

“Apple was in a different position this quarter than it was 12 months before,” said Gupta. “It had three new smartphones — the iPhone 8, iPhone 8 Plus and iPhone X — yet its performance in the quarter was overshadowed by two factors. First, the later availability of the iPhone X led to slow upgrades to iPhone 8 and 8 Plus, as users waited to try the more-expensive model. Second, component shortages and manufacturing capacity constraints preceded a long delivery cycle for the iPhone X, which returned to normal by early December 2017. We expect good demand for the iPhone X to likely bring a delayed sales boost for Apple in the first quarter of 2018.”

Elsewhere, Android extended its lead as the top smartphone operating system, up 1.1 percentage points to 86 per cent of the market.