Gartner Says Worldwide Smartphone Sales Recorded Slowest Growth Rate Since 2013

  • Smartphone Sales Declined for the First Time in China

  • Android's Year-Over-Year Growth Rate at its Lowest

Gartner, Inc. said worldwide smartphone sales recorded the slowest growth rate since 2013 in the second quarter of 2015. Worldwide sales of smartphones to end users totaled 330 million units, an increase of 13.5 percent over the same period in 2014 (see Table 1).

"While demand for lower-cost 3G and 4G smartphones continued to drive growth in emerging markets, overall smartphone sales remained mixed region by region in the second quarter of 2015," said Anshul Gupta, research director at Gartner. Emerging Asia/Pacific (excluding China), Eastern Europe and Middle East and Africa were the fastest-growing regions, driven by good performance from Chinese and local vendors. By contrast, smartphone sales in China fell for the first time year over year, recording a 4 percent decline.

"China is the biggest country for smartphone sales, representing 30 percent of total sales of smartphones in the second quarter of 2015. Its poor performance negatively affected the performance of the mobile phone market in the second quarter," said Mr. Gupta. "China has reached saturation — its phone market is essentially driven by replacement, with fewer first-time buyers. Beyond the lower-end phone segment, the appeal of premium smartphones will be key for vendors to attract upgrades and to maintain or grow their market share in China."

Despite the launch of new S6 models, Samsung's premium phones continued to be challenged by Apple's large-screen iPhones. Samsung lost 4.3 percentage points in market share and declined 5.3 percent in unit sales in the second quarter of 2015. Huawei recorded the highest sales growth rate of 46.3 percent, thanks to strong overseas sales and 4G smartphone sales in China. iPhone sales increased 36 percent, which helped Apple gain 2.4 percentage points in market share. Apple recorded strong iPhone replacements in both emerging and mature markets — and particularly in China. Total iPhone sales in China grew 68 percent to 11.9 million units.

Table 1

Worldwide Smartphone Sales to End Users by Vendor in 2Q15 (Thousands of Units)

Company 2Q15 Units 2Q15 Market Share (%) 2Q14 Units 2Q14 Market Share (%)
Samsung 72,072.50 21.9 76,129.20 26.2
Apple 48,085.50 14.6 35,345.30 12.2
Huawei 25,825.80 7.8 17,657.70 6.1
Lenovo* 16,405.90 5 19,081.20 6.6
Xiaomi 16,064.90 4.9 12,540.80 4.3
Others 151,221.70 45.9 129,630.20 44.6
Total 329,676.40 100 290,384.40 100

Source: Gartner (August 2015)

*The results for Lenovo include sales of mobile phones by Lenovo and Motorola both in 2Q15 and 2Q14.

Apple's double-digit growth in the high-end segment continued to negatively impact its rivals' premium phone sales and profit margins. Many vendors had to realign their portfolios to remain competitive in the midrange and low-end smartphone segments. This realignment resulted in price wars and discounting to clear up inventory for new devices planned for the second half of 2015.

In the smartphone operating system (OS) market (see Table 2), Android's global share was affected by the weak performance of China in the second quarter of 2015 and the strong performance in China of Apple, which has taken share from Android for the last three quarters. "Android saw its lowest year-over-year growth of 11 percent with share reaching 82.2 percent in the second quarter of 2015," said Mr. Gupta. Microsoft continued to struggle to generate wider demand for Windows Phone devices — even at the lower end. "In light of Microsoft's recent cuts in its mobile hardware business, we'll await signs of its long-term commitment in the smartphone market."

"The low barrier to entry into the Android segment will continue to encourage an array of new players, adding to further disruptions coming from Chinese manufacturing and innovative Internet players with new business models that are not reliant on hardware margins," said Mr. Gupta.

Table 2

Worldwide Smartphone Sales to End Users by Operating System in 2Q15 (Thousands of Units)

Operating System 2Q15 units 2Q15 Market Share (%) 2Q14 units 2Q14 Market Share (%)
Android 271,010 82.2 243,484 83.8
iOS 48,086 14.6 35,345 12.2
Windows 8,198 2.5 8,095 2.8
BlackBerry 1,153 0.3 2,044 0.7
Others 1,229.00 0.4 1,416.80 0.5
Total 329,676.40 100 290,384.40 100

Source: Gartner (August 2015)

Worldwide mobile phone sales to end users totaled 446 million units during the second quarter of 2015. The performance was flat (0.4 per cent) year over year (see Table 3). Vendors that are focused on the emerging markets, such as Huawei, ZTE, TCL Communication and Micromax, benefited from high demand in these markets, while global vendors such as Sony, Samsung and HTC struggled to achieve growth at the high end of the market.

Table 3

Worldwide Mobile Phone Sales to End Users by Vendor in 2Q15 (Thousands of Units)

Company 2Q15 Units 2Q15 Market Share (%) 2Q14 Units 2Q14 Market Share (%)
Samsung 88,739 19.9 97,418 21.9
Apple 48,086 10.8 35,345 8
Microsoft 27,690 6.2 43,814 9.9
Huawei 26,119 5.9 18,219 4.1
LG Electronics 17,622 4 18,310 4.1
Lenovo* 16,626 3.7 19,266 4.3
Xiaomi 16,065 3.6 12,541 2.8
TCL Communication 15,733 3.5 13,923 3.1
ZTE 14,560 3.3 12,629 2.8
Micromax 9,884 2.2 8,578 1.9
Others 164,634.70 36.9 164,148.30 37
Total 445,758.80 100 444,190.40 100

Source: Gartner (August 2015)

*The results for Lenovo include sales of mobile phones by Lenovo and Motorola both in 2Q15 and 2Q14.

Additional information is available in the Gartner report "Market Share: Final PCs, Ultramobiles and Mobile Phones, All Countries, 2Q15 Update."

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