The IDC Worldwide Quarterly Mobile Phone Tracker now has figures for Q4, 2018 – smartphone sales are not good, especially for Apple and Samsung.

Huawei and OPPO are the big winners collecting a 43.9% and 6.8% increase to Apple’s 11.5% and Samsung’s 5.5% decrease.

IDC measures ‘ship-in’ – it is a good indicator of what companies expect to sell. Sell-out figures vary and are a good indicator of the warehouses overfilled with stock – more on that later.

Top 5 Smartphone Companies Q4 (shipments in millions of units)

The table below is from October to December 2018.

Company 4Q18 Shipment Volume 4Q18 Market Share 4Q17 Shipment Volumes 4Q17 Market Share Year-Over-Year Change
1. Samsung 70.4 18.7% 74.5 18.9% -5.5%
2. Apple 68.4 18.2% 77.3 19.6% -11.5%
3. Huawei 60.5 16.1% 42.1 10.7% 43.9%
4. OPPO 29.2 7.8% 27.3 6.9% 6.8%
5. Xiaomi 28.6 7.6% 28.2 7.1% 1.4%
Others 118.4 31.5% 145.3 36.8% -18.5%
Total 375.4 100.0% 394.6 100.0% -4.9%

Source: IDC Quarterly Mobile Phone Tracker, January 30, 2019

Samsung makes a huge range of models and services over 100 countries.

It also has a very loyal brand following and a huge ecosystem of appliances and entertainment. The market share loss is due to erosion of its volume markets by developing makers in emerging economies. It does not reflect market share in developed countries nor of its Galaxy series smartphones.

IDC

Apple has had a horrendous quarter losing 11.5% of the market (y-o-y)

That was despite releasing three new models – XR, XS and XS Max. Apart from jacking up prices to eye-watering levels, Apple has announced it won’t be entering the 5G market until late 2020. In short, there is no real OS swapping anymore, and Apple users will hang on to existing handsets to see the impact of 5G.

IDC

Huawei has come off a low base.

Its phones continually get better, and the Mate20 Pro is probably the world’s most advanced smartphone with the best camera – for now anyway. It is the first flagship to earn 5-out-5 in a GadgetGuy review. Its Honour range (sold in China) account for over half its sales.

IDC

OPPO is doing extremely well to increase market share against tough competition.

Its strategy of new models every six months and expansion into emerging markets has paid off. In Australia, OPPO is now a household word, and its phones, especially the R-series do very well. It is also a very innovative company.

IDC

We don’t see Xiamoi over here

It has expanded to western Europe and some emerging markets. In China, its Mi Mix/Max/Pro devices are increasingly becoming flagship contenders with attractive price points.

IDC

And now for the 2018 global winners and losers

Reporting quarter-on-quarter is fine, but in the end, it’s the overall sales that count.

Samsung is losing market to Huawei

It needs to do something drastic. It is countering by a faster flow down of premium features into its lower price devices. And it can do that as it controls its supply chain making most of its components.

Apple is teetering on the brink

The huge price increases only came into effect in Q4 and Telsyte research shows Apple’s sell-out market share in Australia is about 42% – not the 56% touted by ‘ship-in’ analytics. There are truckloads of unsold iPhones sitting in warehouses.

Huawei has finally got it right

Its innovation is a serious threat to other brands. It also has a very strong Chinese base so as long as Huaweiphobia does not affect smartphone sales it could very well be number one soon. Huawei does not officially sell in the US as Government employees cannot use them.

We don’t know enough about Xiamoi

Except that it seems to be ‘the little engine that could’! It continually makes great devices and has become known as the Apple of China using similar marketing methods – apart from price. Its international expansion is ‘rapid.’ In 2018 it beat Samsung in India on volume.

OPPO continues to make excellent devices

It has focused on cameraphones. It also has close ties to fashion and sports celebrities – it is cool.

Top 5 Smartphone Companies, Calendar Year 2018
(shipments in millions of units)

Company 2018 Shipment Volumes 2018 Market Share 2017 Shipment Volumes 2017 Market Share Year-Over-Year Change
1. Samsung 292.3 20.8% 317.7 21.70% -8.0%
2. Apple 208.8 14.9% 215.8 14.70% -3.2%
3. Huawei 206 14.7% 154.2 10.50% 33.6%
4. Xiaomi 122.6 8.7% 92.7 6.30% 32.2%
5. OPPO 113.1 8.1% 111.7 7.60% 1.3%
Others 462 32.9% 573.4 39.10% -19.4%
Total 1,404.9 100.0% 1,465.5 100.0% -4.1%

Source: IDC Quarterly Mobile Phone Tracker, January 30, 2019

What is more interesting is the next five places

  • Vivo (OPPO sibling owned by BBK) is next with 104 million sales up 9%. If you add that to OPPO, it is bigger than Apple.
  • LG had 45 million sales, down 19%.
  • Motorola is rising with 39 million sales up 3%
  • TCL/Alcatel had 17 million sales, down 18%
  • Nokia is in 10th place with 15 million sales up 175% (from a standing start).

The huge losers are all ‘others’ like Sony and HTC with 254 million sales, down 24%. There are about 100 other makers that service local markets.

GadgetGuy’s take

I was recently talking to a smartphone industry veteran who said that each brand has its time in the sun and then in the shade. It’s important not to get a sunburn while in the sun. Without mentioning brands, he intimated that its time that other brands came into prominence.

IDC

Fact:

  • The smartphone market is saturated
  • Apple relies on operating system ‘switchers’ (from Android), but that market is no more
  • Carriers no longer subsidise the handset cost from calls/data plans, so the real price is exposed. Apple tried to raise prices and look at the result.
  • Sales at the premium end are less than 10% of volume. Foldables and 5G will push these prices even higher
  • Growing 5G awareness, in the premium end, will defer sales for a year or two
  • All the volume action is in the sub $500 range, and flagship action has gone down to the sub $1000 range where you can get everything you want

Ryan Reith, vice president of IDC Worldwide Mobile Device Trackers, said,

“Globally, the smartphone market is a mess right now. Outside of a handful of high-growth markets like India, Indonesia, Korea, and Vietnam, we did not see much positive activity in 2018.”