TrendForce Reports First-Quarter Tablet Shipments Fell by 34.5% Versus Prior Quarter; Second-Quarter Result Depends on Sales of New iPad Devices

Market intelligence firm TrendForce reports global tablet shipments for the first quarter of 2017 totaled 31.95 million units, representing a steep drop of 34.5% compared with the prior quarter and a year-on-year decline of 9.3%. The shipment slump was attributed to the effect of the traditional slow season and the general decline in tablet market demand.

“After experiencing a significant retreat in shipments for the first quarter, the tablet market is now focusing on the sales performance of the economically priced 9.7-inch iPad that was released towards the end of this March,” said TrendForce notebook analyst Anita Wang. “At US$329, this model is the lowest priced iPad device that Apple has ever offered. The product is expected to generate sales in this second quarter as its shipments pick up.” Wang also pointed out that most of the consumers’ attention was on the 9.7-inch iPad. Microsoft was supposed to release its Surface Pro 5 in the first quarter, but that has been delayed.

Apple can expect turnaround in second-quarter iPad shipments with an estimated increase of more than 15%; Amazon to mass produce a new low-price device in second quarter as well

Apple topped the tablet vendor ranking for the first quarter by holding on to 27.9% of the global market with 8.92 million units of iPad devices shipped. Against the fourth quarter of 2016, iPad shipments fell by 31.8%, while year-on-year comparison also shows a drop of 13%. Wang pointed out that while the new 9.7-inch iPad hit the market at the end of March, its sales will be helped by its price as tablet demand is still concentrated in the low-price segment.

Going into the second quarter, Wang expects the 9.7-inch model to contribute greatly to the iPad shipments. At the same time, Apple will be releasing a new 10.5-inch iPad device. These two products together will push iPad shipments into the positive territory. TrendForce estimates that iPad shipments in the second quarter will go up by more than 15% compared with the first quarter’s figure.”

Samsung’s tablet shipments for the first quarter totaled 6.1 million units, down 23.5% from the prior quarter and down 5.7% from a year ago. Samsung remained second place in the ranking and controlled 19.1% of the global market. Samsung’s strategy going forward will be to keep rolling out new products featuring AMOLED display, such as the 9.7-inch Galaxy Tab S3 that hit the market towards the end of this March. This device was also the only new tablet product that Samsung released in the first quarter. Furthermore, Samsung is actively expanding into the commercial segment of the tablet market by offering 2-in-1 products running on Microsoft Windows and accompanied with stylus pens.

Huawei’s first-quarter tablet shipments came to 2.1 million units, which was a major decrease of 31.1% compared with the prior quarter’s shipments and placed the company in the third place of the vendor ranking. Huawei’s tablet strategy for this year will be mainly about increasing profits by selling premium products. However, focusing on the high-end segment will have an impact on shipments as high prices limit demand for premium products. Also, Huawei will be competing against leading brands with more attractive offerings in the high-end segment. TrendForce expects that Huawei’s tablet shipments for this entire year will contract compared with last year’s volume.

Lenovo took fourth place in the first-quarter ranking with 2.05 million units shipped. This figure translates to a sharp decline of 43.8% compared with last year’s fourth quarter. Wang noted that Lenovo starting this year is going to scale back the resources going into its tablet products. “Besides the general decline in the tablet market, Lenovo also has to deal with losses incurred in its mobile phone business,” said Wang. “Furthermore, Apple’s 9.7-inch iPad is a major challenge in the affordable tablet segment and will impact shipments and profitability of Lenovo and other competing brands.” TrendForce anticipates year-on-year declines for Lenovo’s tablet shipments from the second to the fourth quarter of this year.

Amazon was fifth in the first-quarter ranking as its tablet shipments plummeted by 42.9% versus the prior quarter and came to around 2 million units. Nonetheless, TrendForce believes Amazon has the best chance of posting annual growth among its competitors because the company’s strategy of selling inexpensive devices will likely succeed again. Amazon will start mass production of a new low-priced 7-inch tablet later this second quarter and the product is expected to make a strong sales performance during the year-end holiday promotions.