Gartner says smartphone sales declined for the first time ever in Q4

[midian182]

While smartphone sales have been stagnant for several years, Gartner has never reported a year-on-year decline since it began tracking them in 2004—until now. The analyst firm reports that total global handset sales stood at around 408 million units in Q4 2017, a YoY decline of 5.6 percent.

While Samsung remained on top of the list with just over 74 million units sold, it saw a fall of 3.6 percent compared to Q4 2016. Apple, meanwhile, saw its iPhone sales drop 5 percent from 77 million to 73 million. Out of the top five, only Chinese giants Huawei (7.6 percent) and Xiaomi (79 percent) recorded yearly increases.

Gartner blames two factors on the decrease: The lack of quality “ultra-low-cost” smartphones has meant a slowing of upgrades from feature phones to smartphones; and phone owners buying replacement flagship models are keeping them for much longer.

While Samsung’s sales are falling, Gartner believes the Galaxy S9 handsets, which are set to be unveiled at MWC, are likely to improve the company’s bottom line.

"Although Samsung's significant sales volumes lean toward mid-price and entry-level models, which now face extreme competition and reducing contribution, its profit, and average selling price may further improve if these next flagship smartphones are successful," Gartner said.

While it remains comfortably in its number two spot, sales figures for Apple’s iPhone X will likely have disappointed the Cupertino company. Low demand has reportedly led to Apple cutting production of its flagship in half, leaving OLED supplier Samsung searching for new buyers. But Gartner says iPhone X sales will see a boom this quarter.

It’s not all bad news, though. Gartner adds that total phone sales for the entirety of 2017 exceeded 1.5 billion units—a 2.7 percent increase compared to 2016. Android, meanwhile, cemented its position as the most popular OS, with its market share increasing 1.1 percent to 85.9 percent.

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https://www.techspot.com/news/73402-gartner-smartphone-sales-declined-first-time-ever-q4.html

 

[MoeJoe]

Millennials getting smarter, along with everyone else.

This 'new phone every year' upgrade fad has hit that crucial point of diminishing returns.

Glad to see it.
Incremental advancements 'on purpose' is BS.

 

[Vulcanproject]

Lots of reasons. Phones are getting like CPUs these days, if you make the right buy you can keep it a few years and not be remotely concerned about minor incremental updates that are pushed year on year.

Said updates being pushed are diminishing in importance while retail costs rocket. The Iphone X being the flagship example, a $1000 phone with a huge increase in price over it's 12 month old predecessor. Meeting thoroughly deserved lukewarm sales.

 

[JaredTheDragon]

I blame Apple and Microsoft equally, for not being able to count to 9.

 

[Theinsanegamer]

This is to be expected.

Even 3 years ago, the difference in capability and processing power from one year to another was massive, as were things like screen quality.

These days, however, processors have gotten good enough for just about everything. GPU power only needs to increase to match higher resolutions, and 1080p seems to be good enough that people are no longer looking for higher resolutions. 4k demand has been very weak. Internal storage has gotten fast enough to meet the demands of nearly everybody, cameras are good enough for 99% of users, ece.

there are just no major improvements coming out right now. There is nothing the S9 will do that the S8 and S7 couldnt do, for example. The constant rising price is also turning many people off, especially as the contract-your-phone-purchase method begins to dissipate.

I think this is a good thing. Phones last a long time now, and the "replace it every year" philosophy was getting too popular. Perhaps as sales decrease, companies will think twice about making devices so disposable.

 

[gh0st11]

I agree with the above comments.I like how "analyst and advisors" always tend to omit new company trends that consumers don't like.I think a percentage of it is due to people not wanting to lease phones.My sister works for Sprint and claims a lot of customers don't like leasing over purchasing a phone.I know this does not speak for vast volume or all carriers but I am sure it plays a small part.I have to agree with that to some extent being that I am in the small percentage that liked the subsidized phone plans.

 

[fktech]

Phones companies shifting how they sell phones is what caused this decline.

 

[Footlong]

Am I the only one surprised with Apple market share? Apple phones are expensive and here I thought Apple had a small, but rich market share. Like Lexus for cars or Armani for clothing.