TrendForce: Global smartphone shipments reach 310 million in third quarter as Apple’s market share grows 5%

Global smartphone shipments grew 9.1% to reach 310 million units in the peak-season third quarter, buoyed by the iPhone 6 launch. Apple’s market share expanded 5% on year, the most of any major handset brand. The larger screen of the new iPhone was a decisive factor in Apple’s strong performance, said Avril Wu, an assistant vice president at TrendForce, a Taiwan-based market intelligence firm. Among Chinese brands, shipments only grew slightly, but Huawei and Lenovo both performed respectably on the back of overseas sales. 

Apple rises, Samsung falls 

Production went smoothly for ODM manufacturers in the third quarter, helping the iPhone 6 to surpass Apple’s shipments target of 73.5 million units to reach 80 million units. The 4.7-inch model accounted for 70% of the shipments and the 5.5 inch 30%. “Women prefer the 5.5-inch model, while men like the 4.7 inch size because it can fit in their pockets,” Wu said. Despite some negative reviews of the iPhone 6 upon its launch, sales were unaffected and supply remains tight, she added. 

The third quarter was disappointing for Samsung. The premium handset market overwhelmingly favored Apple, causing sales of the Samsung Galaxy S5 and Note 4 to stagnate. Samsung’s less expensive handsets also sold poorly. “China was once Samsung’s largest market, but it is now losing market share at the high end to Apple and in the lower tiers to Chinese brands, which offer better value and comparable performance,” Wu said. As a result, Samsung only accounted for 30% of global smartphone shipments in the third quarter. LG fared better, with 6.4% of the global smartphone market, surpassing Huawei to become the No. 4 vendor globally. 

Lenovo and Huawei perform well, Xiaomi’s sales below forecast 

China is the world’s most important smartphone market from the standpoint of both manufacturing and market size. Yet Chinese brands underperformed in the third quarter because carriers cut subsidies, manufacturers shuffled their inventory and consumers held off on new handset purchases in anticipation of the iPhone 6 launch, said Alan Chen, a mobile analyst at TrendForce. Huawei and Lenovo posted better results because of their larger presence in overseas markets, where sales were better in the third quarter than in China, Chen added. 

Meanwhile, subsidy cuts and competitors copying its marketing strategy hurt Xiaomi’s third-quarter sales. Still, since some new Xiaomi models have been delayed, once they are launched in the fourth quarter, Xiaomi should reach its sales target for the year, Chen said. 

With the China smartphone market maturing, Chinese brands will be forced to look overseas for growth opportunities in the fourth quarter. Given their adeptness at keeping prices down, they have performed the best in India, where consumers are highly price sensitive, of any emerging market. India offers them excellent opportunities for growth because it has a relatively young population and smartphone penetration there is considerably lower than in China.