Gartner: Smartphone Sales Up in 1Q Despite Shipment Slump

This is the first time the iPhone-maker has registered a double-digit decline in sales figures.

According to calculations by market researcher Gartner, 349 million smartphones were sold worldwide in the first quarter of 2016, a 3.9 per cent increase over the same period in 2015. Apple's market share has dropped from 17.9% in 1Q15 to just 14.8% in 1Q16, despite the iPhone 6 and 6s "upgrade programme" in the U.S. and an increased interest in reselling secondhand iPhones to developing markets.

The report noted Samsung's success was due in a large part to the release of Galaxy S7 series phones and a renewed portfolio, which has positioned the company to be competitive in the wider market, as well as in emerging markets where competition is fiercer.

Chinese smartphone makers like Huawei, ZTE and Xiaomi don't come close to leading sales in the US, but they are gaining around the world. The Chinese company, fuelled by strong growth in its home market of China has moved into the number four position with unit sales growth of 145%. The global smartphone wars are taking on an interesting new look, as Chinese upstarts like Huawei, Alcatel, ZTE and Xiaomi continue to chalk up sales around the world, and even begin appearing consistently on top sales lists in countries in Europe and Asia. This, Gartner says, shows Google's awareness that the smartphone market is nearly saturated, so it has adapted strategic aims of ubiquitous Android software on a variety of devices, including wearables and smart home technologies.

In fact, three Chinese brands now rank within the top five worldwide smartphone vendors, up from two this time previous year.

Smartphone sales accounted for 78 per cent of total mobile phone sales.

Furthermore, that the smartphone market is slowing down makes it hard for mobile phone vendors to reach previous levels of growth. Gartner also attributes the sales to 4G connectivity plans offered by service providers in many markets worldwide. Their market share also increased, with the three vendors - Huawei, Oppo and Xiaomi - accounting for 17 per cent of the market, up from 11 per cent in Q1 2015.

Microsoft, who is making a hard swing to the much smaller enterprise smartphone market, has earlier said they expect Windows Phone sales to deteriorate further in Q2 2016, meaning Microsoft may soon vie with Blackberry for which "major" smartphone operating system has the lowest market share. Its smartphone sales fell by 75% in Greater China, where it faced strong competition from local brands.

Gartner's numbers show Samsung's market share falling from 24.1% to 23.2%.

The next three smartphone vendors in terms of market share were all Chinese. "This will have an impact on the vendor landscape where new or more innovative business models will increasingly become key to succeed".

"Making good hardware won't be an issue for Nokia, but users need a compelling reason to remain loyal to the same brand". Gartner says Nokia's return to smartphone and tablet market won't be an easy mission.

Source: Gartner: Smartphone Sales Up in 1Q Despite Shipment Slump