Smartphone Sales Q1 2016 - Shake Ups in the top 5

IDC recently posted Q1 2016 Smartphone sales and there were some big shake ups in the top 5.

 Overall Q1 2016 Smartphone Sales were relatively flat with 334.9M units sold vs 334.4M in 2015 a very most 0.2% gain.

 But the big changes came in market share and the emergence of a new players in the top 5.

 Samsung is still #1 worldwide and sold 81.9M units - a 0.6% decline from 2015 and it's market share percentage dropped 1/10th of 1% to 24.5.  Sales of the new Galaxy S7 which started in March were very strong - so I expect a strong Q2 from Samsung.

 As I documented in an earlier post #2 Apple saw a dramatic decline of 16.3% in unit sales, selling 51.2M units in Q1 versus 61.2M in 2015.  Apple's market share also dropped 3% from 18.3% to 15.3%.

 Huawei maintained it's 3rd place with 27.5M units sold, a 58.4% growth over the same period in 2015 and experienced a 3% growth in market share from 5.2% to 8.2%.  

 The dramatic change happened in positions 4 & 5 where the new #4 OPPO - displaced Lenovo and experienced 153.2% growth with sales of 18.5M units and a market share of 5.5%.  The new #5 is vivo which displaced Xaiomi and experienced 123.8% growth with 14.3M units and a 4.3% market share.

 When you add up the top 3 Chinese firms, Huawei, OPPO and Vivo - they sold a total of 60.3M units and maintain an 18% market share.  These 3 companies are putting tremendous pressure on Apple and it is entirely possible that Apple could fall to 3rd or even 4th by the end of the year. 

 One of the big reasons is price point.  There is a large sweet spot in the sub $250US market for smartphones and these new firms have products well positioned in that space.  So even with the new iPhone SE - Apple will struggle versus the local brands.   

 Samsung has also positioned itself as the premium choice over Apple with the S7

 While the IDC news report did not call it out specifically I expect Android to see an increase in overall market share from 83.3% in Q4 of 2015 to maybe 85% or higher..  

 While the vast majority of sales of the 3 Chinese firms are mostly in China and Asia in general - I expect that in the not too distant future you'll see them starting to show up in force in the US/EU markets.  Today the providers in the US obviously have their strong ties to long time partners, but I expect that to open up.

 Bottom line is this - in a market place that sells upwards of 1.4B devices per year the competition is going to be brutal.  More so than the PC business which has been consolidating in recent years as unit sales decline. With China being the largest individual market and sales there impacting WW total sales and market share rankings decisively - the local Chinese companies are going to continue to take share.  But I think mostly that share will be taken from Apple and not Samsung.   


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