Global smartphone shipments faced the largest annual decline ever in the first quarter of 2020, with the ongoing coronavirus pandemic mostly at fault.
According to International Data Corporation (IDC), between the period of January to March, smartphone makers shipped just 275.8 million devices; an 11.7% drop during the same quarter in 2019.
The decline was exacerbated by a 20.3% decline in shipments within China, as China alone accounts for nearly one quarter of worldwide smartphone shipments. And in a bid to contain the outbreak, the Chinese government shut down parts of the country in February.
“What started as primarily a supply-side problem initially limited to China has grown into a global economic crisis with the demand-side impact starting to show by the end of the quarter,” said Nabila Popal, research director with IDC’s Worldwide Mobile Device Trackers.
As the quarter progressed, this global dependency on China for smartphone components and assembly lines caused a slump in shipments with the US and Western Europe dropping by 16.1% and 18.3% respectively.
The China-based research firm, Canalys, in its own research suggests that smartphone shipments in China fell by 18%, but the slump may just be temporary as, “The smartphone’s status as an ‘essential’ personal item has stopped the market falling further during the pandemic,” according to Nicole Peng, the vice president of mobility at Canalys.
While market leader Huawei saw a 1% growth in its shipments for the quarter, other key players like Apple, Oppo, Xiaomi, and Vivo saw declines.
Canalys further predicts that in the best scenario we may expect smartphone shipments to reach 326 million devices in China by the end of 2020. This figure also includes a projection of 137 million 5G smartphones shipped within the same year.
According to Counterpoint Research, this has been the first quarter, since early 2014, that smartphone shipments haven’t exceeded 300 million devices.And Counterpoint Research offered a more somber warning. Counterpoint’s Associate Director, Tarun Pathak, hinted that users may decide not purchase new high-end devices in the near future. “Consumers, under these uncertain times, are likely to withhold making many significant discretionary purchases,” said Pathak. “This means the replacement cycles are likely to become longer.” Instead he suggested that consumers that are looking to purchase a new device, may instead opt for cheaper models considering the current uncertain state of the economy.
