Sales of Samsung and Huawei smartphones suffered the heaviest declines in the first quarter of this year as the devastating impact of COVID-19 hit consumption and production of global smart phones.
Available data shows that Global shipments of smartphones fell at the fastest rate on record in the first quarter, totalling about 275 million in the first three months of the year. This is according to market trackers Strategy Analytics, which estimate the decline from the same period in 2019 at 17%.
This fall in sales is attributed to the novel coronavirus outbreak, which hurt the supply chain — with factories across Asia having to shutter temporarily to constrain the spread. There was also a slowdown in demand due to widespread lockdowns that included retail stores.
“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 at IDC.
Bellwether supplier Murata Manufacturing Co. had said in mid-April that most of its customers were maintaining order volumes and road maps through the rest of the year, but on Thursday it revised that outlook with a forecast of a 10% slump in demand for the current fiscal year.
“The outlook is extremely hard to foresee now,” Chairman Tsuneo Murata said.
IDC Worldwide Mobile Device Trackers’ analysis found Apple Inc. iPhones mostly unchanged at close to 37 million shipments, showing greater resilience than top smartphone vendor Samsung Electronics Co., whose output fell from just under 72 million to about 58 million shipments in the quarter.
Huawei Technologies Co., with the added pressure of U.S. sanctions and scrutiny, dropped by roughly 10 million units in the quarter, landing near 49 million.
While Samsung and Huawei shipments took a dive, Xiaomi Corp. achieved a record 10% market share, according to both market research groups, and managed to increase its shipments, by IDC’s estimation.
“Xiaomi is dominating the huge India market at the moment and this is giving the company a big boost in smartphone shipments,” said Linda Sui of Strategy Analytics.
Looking forward, IDC expects consumer demand to remain suppressed through the rest of the year, with the global economic downturn preventing any year-on-year growth until at least the fourth quarter.
