Published: Fri, February 23, 2018
Hi-Tech | By Wayne Curry

For the first time ever, smartphone sales go down year-over-year

For the first time ever, smartphone sales go down year-over-year

Global sales of smartphones to end users stood at 408 million units in the December quarter of 2017, a decline of 5.6% from 432 million a year ago, research firm Gartner said.

It reported global sales of almost 408 million smartphones in the final three months of 2017, down 5.6 per cent versus the same quarter a year earlier.

Gartner says that the decline in sales is due to lack of low cost, quality smartphones and the users' preference for buying quality feature phones.

"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", Gupta noted.

Worldwide Smartphone Sales to End Users by Vendor in 4Q17 (Thousands of Units) Source: Gartner.

Interestingly, this is the first year-on-year decline since Gartner started tracking the global smartphone market in 2004.

Huawei and Xiaomi were the only smartphone vendors to achieve year-on-year unit growth (7.6% and 79% respectively).

Samsung managed to hold onto the No. 1 position in the fourth quarter, even though its unit sales slid 3.6 percent to 74 million units, Gartner said.

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The combined market share of Chinese vendors has increased by 4.2 percent, while Samsung and Apple's market share as the top companies is unchanged.

"We expect good demand for the iPhone X to likely bring a delayed sales boost for Apple in the first quarter of 2018".

The iPhone maker had three new smartphones - the iPhone 8, iPhone 8 Plus and iPhone X - yet its performance in the quarter was overshadowed by two factors. It also says Xiaomi's "competitive" portfolio accelerating its growth in the emerging APAC market and helped it win back lost share in China.

In Australia brands such as Huawei and Sony are struggling to get traction while brands such as Alcatel, Apple, Samsung and Nokia are experiencing growth.

But more broadly, it seems clear that smartphones are reaching their saturation point, at which just about every human being who wants a smartphone has one.

This has prompted growth in the Asia/Pacific (APAC) region, and in particular, China, Indonesia, and India are prompting accelerated sales. Samsung's sales decreased by 3.6% for Q4, and Apple dropped a somewhat surprising 5%.

Worldwide sales, however, increased by 2.7 per cent during the entirety of 2017, totaling more than 1.5 billion units.

Samsung's profit and average selling price could improve if its next flagship phones, the successors to its Galaxy series which are expected to launch this year, are successful.

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