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Thursday, October 29, 2020

Global smartphone sales plummet due to the coronavirus pandemic

2020 was supposed to be the big year for the smartphone market to bounce back in territories like the US, Europe, and Japan.

By: Tech Desk | New Delhi | May 1, 2020 2:52:46 pm
Coronavirus, smartphone sales declined in Q1 2020, Apple, Samsung, Xiaomi, iPhone, Counterpoint, IDC, Canalys, Covid 19, lockdown India Smartphone makers shipped 275.8 million devices from January to March, according to market research firm IDC. (Image credit: Bloomberg)

The global smartphone market has been hit hard by the coronavirus pandemic. In fact, sales of smartphones plummeted in the first quarter of 2020 due to weak demand and disruption in the supply chain. Market research firms IDC, Counterpoint, and Canalys say the Covid-19 has pulled down the smartphone market in the first three months of the year.

While Counterpoint and Canalys estimated that the global smartphone shipments declined by 13 per cent, IDC estimated the drop was 11.7 per cent year over year. Smartphone makers shipped 278.5 million smartphones from January to March, the largest decline ever. Counterpoint estimated that smartphone shipments have come under 300 million since 2014.

China saw a decline of 20.3 per cent, followed by Western Europe, at 18.3 per cent and the US,  at 16.1 per cent decline. “What started as primarily a supply-side problem initially limited to China has grown into a global economic crisis with the demand-side impact starting to show by the end of the quarter,” said Nabila Popal, research director with IDC’s Worldwide Mobile Device Trackers. Canalys says the drop in China was 18 per cent while Counterpoint estimates it at 27 per cent.

Samsung, Huawei and Apple are still the top three smartphone makers by shipments. While both Samsung and Huawei saw a steep decline in sales in Q1 2020 Apple registered the smallest decline year over year, according to Counterpoint Research. Xiaomi, Oppo and Vivo continue to be third, fourth and fifth largest smartphone makers in the world.

Services help Apple Q2 revenue hit $58.3 billion, despite Covid-19 pandemic

“Demand for new devices has been crushed,” says Canalys Senior Analyst Ben Stanton. “In February, when the coronavirus was centered on China, vendors were mainly concerned about how to build enough smartphones to meet global demand. But in March, the situation flipped on its head. Smartphone manufacturing has now recovered, but as half the world entered lockdown, sales plummeted.”

2020 was supposed to be the big year for the smartphone market to bounce back in territories like the US, Europe, and Japan. Every major phone company was betting on 5G and foldable devices to gain new consumers. Now, it doesn’t seem that consumers will be eager to spend money on a new smartphone this year due to an uncertain environment.

“Most smartphone companies expect Q2 to represent the peak of the coronavirus’ impact,” says Stanton. “It will test the mettle of the industry, and some companies, especially offline retailers, will fail without government support.”

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