Shipment term

Smartphone shipments: Smartphone volumes fall, but revenues hit record high

So far, holiday season smartphone shipments are 20-25% lower than a year earlier, at around 18 million units, hurt by lukewarm demand in entry price segments high-volume end-to-end amid accelerating inflation, according to market trackers.

However, revenue from smartphone sales since the start of the season at the end of last month has hit a record $3 billion, driven by higher average prices as brands offer more expensive devices with deals and discounts, they added.

“Based on our conversations with OEMs (manufacturers) and channels, smartphone shipments were 18 million units, 20-25% lower than what was seen last year,” said Faisal Kawoosa, chief analyst at market research firm TechArc.

Revenue rose 30% to a record $3 billion, he added.

Research from Strategy Analytics is more conservative, indicating that sales for the first eight days of the holiday season saw 12.8 million smartphones sold, down 2% from last year. However, revenue jumped 17% to $2.1 billion.

Strategy Analytics analyst Abhilash Kumar cited lower sales of entry-level devices amid high inflation and recession fears for the drop in sales volume. “But the growth in ASP (average selling price) offset the decline in volume and generated decent revenue growth,” he added.

Samsung, Xiaomi and Realme are the top 3 beneficiaries of this festive season sale, said Linda Sui, Senior Director of Strategy Analytics. “These three brands combined accounted for 62% of overall sales by volume.”

Samsung led with a 26% share, selling 3.3 million units in the first half of the holiday season. Next come Xiaomi with 2.5 million units and Realme with 2.2 million units, the firm estimated.

Apple’s iPhones, although not in the top three, also sold well thanks to a discount of up to 33% at major online retailers, with the iPhone 13 being the most popular among iPhones. Apple devices, Strategy Analytics found.

IDC India expects shipments to remain flat compared to last year, but revenue to hit a record high.

“You’ll see more stories about value growth, but if you double-click on them, you’ll see volumes have gone down,” said Navkendar Singh, associate vice president of device research, IDC India.

“That means people are buying more expensive smartphones. As a result, there isn’t much growth below the mid-range segment,” he added.

While the first half of holiday season sales that started from Sept. 23 were dominated by online channels, with 60% of smartphone sales on Amazon and Flipkart, according to IDC’s Singh, the second half may see footsteps increase in large retail stores. .

“Offline sales will pick up now, and smartphone brands will push retailers to buy more inventory and divert remaining online inventory to offline channels,” IDC’s Singh said.

However, major retailers ET spoke to said that while footfall is expected to increase in the days leading up to Diwali, there will be a lag in customer expectations.

“Customers are walking in demanding high-end devices, but we are not getting high-end smartphone stocks,” said Navneet Pathak, co-secretary of the All India Mobile Retailers Association.

IDC’s Singh said existing smartphone users are increasingly switching to high-end devices.

This means that there is not much demand for entry-level smartphones, which are mainly purchased by users who are switching to a smartphone for the first time, but cannot do so now due to the pressure of inflation on their disposable income. Additionally, the holiday season kicked off earlier this month, before salaries were credited, industry experts said.