Global Smartphone Shipments Increase in Q3, Continuing Growth Trend

Global smartphone shipments experienced an increase in the third quarter, marking a continuation of the industry's growth trend. This rise reflects a strong demand for mobile devices as manufacturers adapt to consumer preferences and technological advancements. Key factors contributing to this growth include the launch of new models, enhanced features, and an expanding market reach, indicating a positive outlook for the smartphone sector in the coming months.

Market analysts may disagree on the extent of growth in smartphone shipments during the third calendar quarter of this year, but they unanimously agree that the market is recovering from its post-pandemic stagnation.

According to global market research firm Canalys, worldwide smartphone shipments increased by 5% in Q3 compared to the same period in 2023. This marks the fourth consecutive quarter of growth. Meanwhile, IDC reported a 4% increase for the same timeframe, indicating five straight quarters of growth.

Canalys credited this rise to demand in emerging markets, along with the early stages of a replacement cycle in North America, China, and Europe. IDC highlighted that the strong growth in Q3 was driven by Chinese vendors such as Vivo, Oppo, Xiaomi, Lenovo, and Huawei.

Stellar Quarter for Apple

Nabila Popal, IDC's Research Director for Worldwide Client Devices, noted that Chinese phone manufacturers were not the only ones achieving significant growth during this period. “While the growth of the Chinese brands in emerging markets has been a recurring theme this year, Apple also saw a 3.5% year-on-year growth in shipments this quarter, fueled by robust demand for previous models and the launch of the new iPhone 16 series,” she stated. “In Q3 2024, older iPhone models, particularly the iPhone 15, performed exceptionally well due to extensive promotions and heightened marketing activities surrounding Apple Intelligence,” she added.

“Despite a staggered launch of Apple Intelligence in markets outside the U.S., Apple is poised for growth in the upcoming holiday season as it anticipates that many customers will upgrade from the iPhone 13, iPhone 12, and earlier models to a new AI-enabled smartphone, ensuring their purchases are future-proof,” Popal predicted.

According to Canalys, Apple’s growth in Q3 brought it close to surpassing Samsung in market leadership.

“Apple achieved its highest third-quarter volume to date and is now closer than ever to leading the global smartphone market in Q3,” stated Canalys Analyst Runar Bjørhovde.

“The market's shift towards premium devices, coupled with the ongoing refresh cycle of devices purchased during the pandemic, is benefitting Apple, especially in stronghold regions like North America and Europe,” he observed.

“Although the initial reception was modest,” he continued, “the iPhone 16 is expected to help Apple finish 2024 strongly and maintain momentum into the first half of 2025, especially as Apple Intelligence expands into new markets and supports additional languages.”

Samsung Remains Market Leader

According to IDC, Samsung shipped 57.8 million phones in Q3, capturing an 18.3% market share, down from 59.5 million units and a 19.6% share in Q3 2023. Conversely, Apple shipped 56.0 million units during this period, achieving a 17.7% share, compared to 54.1 million units and a 17.8% share in Q3 2023. “Samsung retained its market leadership despite a decrease in the total number of units shipped,” stated IDC Vice President for EMEA Client Devices, Francisco Jeronimo.

“However,” he added, “the company continues to gain share in the premium segment, with average prices increasing in the quarter, driven by a stronger mix of Galaxy AI-enabled models.”

“The company has begun rolling out Galaxy AI features to other Samsung models and launched the new Galaxy Z Fold6 and Galaxy Z Flip6 foldables with Galaxy AI, which enhanced performance in the premium segment,” he explained.

“I believe that improvements in AI capabilities are making more mainstream smartphones more appealing, and there’s widespread demand for AI,” noted Anshel Sag, a senior analyst at Moor Insights & Strategy, a technology advisory firm based in Austin, Texas, in an interview with TechNewsWorld.

Industry Faces Challenges

Canalys Analyst Le Xuan Chiew mentioned that the gap between the top five vendors has narrowed, intensifying competition in the market.

“Vendors are entering the holiday shopping season with strong momentum and cautious optimism, aiming to attract consumers who have postponed upgrading their devices while anticipating deals during major events like 11.11 and Black Friday,” he stated.

“However,” he cautioned, “the importance of effective resource planning cannot be overstated. While market conditions are improving, demand remains fragile as vendors face rising global challenges in demand generation and regulatory obstacles, such as the EU’s eco-design directive.”

“Effective supply chain management, maintaining healthy inventory levels, and optimizing sales and marketing fund allocation are becoming increasingly crucial for market leadership.” Bjørhovde told TechNewsWorld that the smartphone industry is currently facing an existential crisis. “They need to find attractive points that can stimulate demand,” he remarked.

“At this point, it’s all about generative AI,” he elaborated. “A significant reason AI is a focal point is that many smartphone vendors are exploring it for new monetization opportunities.”

“However, many people are not fully grasping what these AI features entail,” he added. “From an analyst's perspective, there are numerous intriguing developments that will lead to exciting products and solutions in the next two, three, or even four years. For consumers, however, AI features often appear merely as advanced editing tools rather than significant differentiators for smartphones.”

Continued Growth Expected in 2025

Bjørhovde explained that the smartphone market has become a tactical game. “It’s about attracting switchers and identifying upselling opportunities amidst a clear global trend of extending the lifespan of phones,” he said.

“While the goal is to encourage upgrades, the opposite is occurring,” he noted. “In the U.S., carrier discounts or subsidies are no longer as robust. Thus, finding add-on features, new revenue streams, and sometimes leaning more into B2B opportunities is where most smartphone vendors are focusing.”

He added, “The industry has shifted from a concept of revolution to evolution. It has become burdened by the expectation set from 2007 to 2015, where every release was highly anticipated with unexpected innovations. Now, that excitement has diminished.”

However, the desire to upgrade remains strong in the lower-end market, he asserted. “Two or three years ago, if you purchased a $150 phone, you might have received a 12-megapixel camera and a battery that lasted half a day or a full day. Now, you can get almost 50 megapixels on the camera and two to three days of battery life. Thus, the upgrades in the budget segment are quite dramatic at the moment.”

Looking ahead to 2025, Sag predicted that the market should see growth in the low single digits, which is typical for a mature market.

Bjørhovde also envisions continued growth in the market. “I believe we’re looking at a year and a half, and if Apple Intelligence starts to introduce new features and becomes genuinely engaging in a year’s time, that could drive more people to consider upgrading at that point.”

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Source: technewsworld‍