Global Q2 Smartphone Shipments Plunged 16%, China Faring Better Than Most: IDC

Worldwide smartphone shipments plunged 16% year over year in Q2 to 278.4 million, said IDC Thursday. The “huge” decline was due to a “massive reduction” in consumer spending due to the COVID-19-led global economic crisis, store closures and rising unemployment, said Nabila Popal. Phones also competed with other technologies consumers needed during lockdown periods, including PCs, monitors and tablets, said the analyst.

Asia-Pacific (excluding China and Japan) fell 31.9%, Western Europe 14.8% and the U.S. 12.6%, while China “fared slightly better” with a 10.3% drop, which “arguably shows some early signs of market recovery,” said analyst Ryan Reith.

Though the smartphone supply chain ground to a halt when the pandemic hit, recovery, "specifically in China, has been strong," said Reith. "The question now becomes what does demand look like with so much uncertainty around the world.” OEMs are moving more aggressively on 5G portfolios with production and pricing, said the analyst, but consumer demand for 5G is still low, “so the supply-side push is likely to produce very high-priced competition."

Market leader Huawei, with 20% share, reached the top spot for the first time (see 2007300037), with 55.8 million shipments, on 10% growth in China, but faces uncertainty due to the U.S. technology ban against the company.

Samsung shipped 54.2 million smartphones in Q2, for 19.5% share, but shipments dropped 29%; the company’s premium Galaxy S20 and Z Flip hit the market during the pandemic’s peak and are struggling despite price cuts, said IDC. Samsung’s A series continues to perform well, contributing most of the company’s smartphone volume, it said.

Many of Samsung’s most important markets were hard hit by COVID-19, especially emerging markets, which accounted for more than 70% of Samsung’s overall shipments in 2019, said Omdia Friday. In Samsung’s key markets in Western Europe, reopening and loosening of restrictions started near the end of Q2, it said.

Apple’s 37.6 million iPhone shipments put it in third place with 13.5% share, with 11.2% growth, driven by the lower priced SE, which launched in the quarter, and continued strength of the 11 series, said IDC. The potential launch of four new models this fall could herald Apple's entry into 5G “and challenge Android 5G devices that have been out for more than a year,” IDC said.

Omdia analyst Jusy Hong called the iPhone SE a “long-desired product, with an attractive price.” Its $399 starting price point also positions the phone well for continued economic uncertainty, said the analyst. Xiaomi finished with 10.2% share and Oppo 8.6% in Q2, said IDC.