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Smartphone Industry Experiences a Tactical Shift
November 04, 2019 There may be a new reality defining the state of the smartphone industry in late 2019, judging by the following headlines:
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These results were achieved without a 5G iPhone, which may be a big trigger for Apple people to upgrade, and without a foldable device like the Galaxy Fold or Mate X.
Although the mobile market in general will soon enter a period of strong year end seasonality. Samsung in its earnings call said, “demand is expected to keep trending down year-on-year due to persistent uncertainties in the global macro environment. For our mobile business, we've had our mass market smartphones, including new A Series models to maintain their solid sales performance. However, the overall sales mix is likely to weaken because of waiting new model effects of the Note 10. We also expect our profit to decrease quarter-on-quarter as marketing cost will increase under strong seasonality. For the network business, we plan to leverage our leadership in commercializing 5G to keep solidifying the foundation of our global 5G business. … the mobile market, demand for 5G smartphone is expected to increase as commercialization of 5G accelerates. However, already fierce competition is likely to keep rising, especially within the trend of offering high end specs. And there are strong indications that the foldables in some form factor have the potential to catch on.”
Apple cast a spell on investors after it reported better-than-expected quarterly earnings on Wednesday, and its shares rose 2%. iPhones sales rose more than predicted. And revenue from the company’s services like music- and video-streaming was also higher than expected, which bodes well for its plan to focus on growing the segment. But investors were also closely watching Apple’s revenue forecast for this quarter, which includes the all-important holiday shopping season. Apple has an eerie influence on the direction of both the country’s and the global stock market.
But, global smartphone shipments in Q319 were flat Y/Y at 380m, as Samsung and Xiaomi were up 8.4% and 28.5% respectively, while Apple and the other three major Chines OEMs were down Y/Y. The standout was #7 Realme, which shipped 10.2 units vs. 1,3m in Q318.
Table 1: Q319 Global Smartphone Shipments, Share, Growth
- Apple said at its quarterly earnings call, “iPhone active installed base grew to all-time highs in all geographical segments.”
- So even if some consumers are not buying new iPhones, they’re not switching, either
- iPhone 11 sales will be clearer in the next earnings report, but Apple gave strong Q1 2020 guidance, estimating revenue of between $85.5 billion and $89.5 billion, a bump up, if Apple achieves it on the back of the iPhone 11,Aple Watch and AirPods Pro.
- Bloomberg said: "Apple aims to ship more than 200 million handsets in 2020 after introducing four new iPhone models, including 4G and 5G models and a low-cost successor to the budget iPhone SE device.
- But Sony can’t catch a break, shipping just 600,000 Sony smartphones in three months, meaning Huawei ships more phones in an average day than Sony sold in an entire quarter.
Although the mobile market in general will soon enter a period of strong year end seasonality. Samsung in its earnings call said, “demand is expected to keep trending down year-on-year due to persistent uncertainties in the global macro environment. For our mobile business, we've had our mass market smartphones, including new A Series models to maintain their solid sales performance. However, the overall sales mix is likely to weaken because of waiting new model effects of the Note 10. We also expect our profit to decrease quarter-on-quarter as marketing cost will increase under strong seasonality. For the network business, we plan to leverage our leadership in commercializing 5G to keep solidifying the foundation of our global 5G business. … the mobile market, demand for 5G smartphone is expected to increase as commercialization of 5G accelerates. However, already fierce competition is likely to keep rising, especially within the trend of offering high end specs. And there are strong indications that the foldables in some form factor have the potential to catch on.”
Apple cast a spell on investors after it reported better-than-expected quarterly earnings on Wednesday, and its shares rose 2%. iPhones sales rose more than predicted. And revenue from the company’s services like music- and video-streaming was also higher than expected, which bodes well for its plan to focus on growing the segment. But investors were also closely watching Apple’s revenue forecast for this quarter, which includes the all-important holiday shopping season. Apple has an eerie influence on the direction of both the country’s and the global stock market.
But, global smartphone shipments in Q319 were flat Y/Y at 380m, as Samsung and Xiaomi were up 8.4% and 28.5% respectively, while Apple and the other three major Chines OEMs were down Y/Y. The standout was #7 Realme, which shipped 10.2 units vs. 1,3m in Q318.
Table 1: Q319 Global Smartphone Shipments, Share, Growth
Source: Counterpoint
In China, Huawei gained 60.2% Y/Y, a supportive reaction of the Chinese consumer to the restrictions placed on the company by the U.S. The unusual growth came at the expense of all the other OEMs in China. Huawei’s China sales more than made up for reductions in the rest of the world.
Table 2: Q319 China Smartphone Shipments, Share, Growth
Table 2: Q319 China Smartphone Shipments, Share, Growth
Source: Counterpoint