Smartphones, which were seen as a hot commodity in the world, have reached a saturation point in sales. Both IDC and Counterpoint Research have released new reports which state that 2018 was the worst year ever for the smartphone industry and they say that there is no bounce back in sight. The annual report came as part of fourth quarter numbers, which say the industry registered a decline of 4 percent last year. While IDC and Counterpoint Research have different methods to calculate these numbers, the general consensus is that the industry saw its worst annual decline yet.

According to IDC and Counterpoint Research, both Apple and Samsung saw decline in their shipments, which led to drag in the shipments of entire industry. Both the research firms note that Samsung saw its shipments decline 8 percent year-over-year but the Korean giant managed to retain its position as the market leader. IDC estimates Samsung to have shipped 292.3 million smartphones in 2018, down from 317.7 million shipped in 2017. Counterpoint notes Samsung shipped 291.6 million smartphones, down from 318.1 million devices shipped in 2017.

Apple, according to IDC, shipped 208.8 million iPhone in 2018, a decline of 3.2 percent from 215.8 million devices shipped in 2017. Counterpoint estimates Apple to have shipped just 206.3 million iPhone models in 2018, a 4 percent decline from 215.8 million devices shipped in 2017. While Samsung and Apple saw their shipments decline, Chinese smartphone makers such as Huawei, Oppo and Xiaomi saw growth.

Huawei was the biggest winner in the smartphone race with both IDC and Counterpoint estimating it to have gained nearly 34 percent in shipments. IDC says Huawei shipped a total of 206 million smartphones in 2018 while Counterpoint claims it shipped 205.3 million units. Xiaomi is estimated to have shipped 122.6 and 121 million smartphones by IDC and Counterpoint respectively. Oppo shipped 113.1 million smartphones in 2018 to see a marginal growth of 1.3 percent. Counterpoint says Oppo shipped 120.2 million smartphones to register flat change in growth.

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During the fourth quarter of 2018, IDC says smartphone shipments were down by 4.9 percent capping off the worst year. “Outside of a handful of high-growth markets like India, Indonesia, Korea, and Vietnam, we did not see a lot of positive activity in 2018. We believe several factors are at play here, including lengthening replacement cycles, increasing penetration levels in many large markets, political and economic uncertainty, and growing consumer frustration around continuously rising price points,” said Ryan Reith, program vice president with IDC’s Worldwide Mobile Device Trackers.

Source: Counterpoint Research

“This is the first time that the global smartphone market has witnessed decline for a whole year. The decline in smartphone shipments can be attributed to lengthening replacement cycles in developed markets like US, China and Western Europe. Smartphone OEMs tried to push sales by adding features such as AI, multiple camera assemblies, full-screen displays, in-screen fingerprint scanners etc. but consumers held on to their devices longer due to the absence of groundbreaking innovations and higher prices of devices being offered by the OEMs,” said Tarun Pathak, Associate Director at Counterpoint Research.

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