Smartphone sales decline further in 2017

Smartphone sales worldwide may be in decline according to new Gartner data. The research firm noted a drop in global smartphone sales of 5.6% during Q4 2017, making it the first year-on-year decline since Gartner started tracking sales in 2004.

Among the core factors for the drop are a slowing of upgrades from mobile phones. Indeed, more consumers now own smartphones and no longer need to upgrade. In addition, smartphones are cheaper than ever. Secondly, users are opting for the environmentally friendly choice and are keeping their smartphones for longer instead of replacing them each year.

This is unlikely to stop big smartphone producers such as Apple or Samsung to churn out new models each year. Tech enthusiasts will still be eager to wait in line to buy a brand new iPhone. However, they may be producing fewer numbers in order to meet weaker demand.

Indeed, users are still seeking a high-quality smartphone experience with better features. However, rarely has there been a replacement smartphone model that made quite the splash as the original iPhone did. Technological advancements or lack thereof may contribute to the weaker demand.

Meanwhile, Chinese smartphone makers Huawei and Xiaomi did experience growth in Q4 2017 – being the only two vendors in the top five to churn out growth. They grew 7.6% and 7.9% respectively. Samsung sales dropped 3.6%, but the company continues to lead in terms of market share, followed by Apple whose sales dropped 5%.

Anshul Gupta, research director at Gartner, explained:

“Apple was in a different position this quarter than it was 12 months before. 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.”

Android continues to lead in terms of operating system market share, up 1.1 percentage points to a 86% market share.