Smartphone sales rebounded in H1 of 2021, following a 12.5% decline in 2020. Previous year’s lower smartphone sales because of COVID-19 and the bounce back to growth has helped propel the market to growth. However, component shortages and supply chain issues disrupted smartphone sales in the H2 of 2021.
“An improved consumer outlook, pent up demand from 2020 in large markets, such as India and China, helped drive sales in the first half of the year,” said Anshul Gupta, senior research director at the US-based Gartner.
“However, this trend reversed in the second half of the year, even with high demand from consumers. Out-of-stock situations for popular models and limited inventories pushed out some of the possible sales to 2022.”
Why Sales Grew
The increase in discretionary spending, opening of marketplaces post lockdown, along with a lower base for comparison from 2020 led to 6% growth in 2021. The introduction of 5G at lower price points to meet future proof needs influenced upgrade purchases.
As a result, smartphone sales grew for all the top five vendors in 2021. In Q4 of 2021, global smartphone sales declined 1.7% owing to supply constraints. Apple maintained the No.1 position among the top five smartphone vendors. The strong demand for iPhones was driven by 5G upgrades. Samsung saw strong demand for its premium phones, and its sales increased 11% as compared to the fourth quarter of 2020.
Chinese smartphone manufacturers Xiaomi, Oppo and Vivo expanded their distribution networks in the Middle East, Africa, Latin America and Europe to capture the opportunities left open by Huawei and LG after their exits from the smartphone business in 2020.
However, Apple’s strong sales in China in the fourth quarter of 2021 weakened demand for Chinese smartphones. Oppo and Vivo experienced a decline in sales, whereas Xiaomi continued to maintain its No. 3 position.
“The smartphone sales declined in 2020 because of COVID-19 and the bounce back to growth in 2021 helped propel the market to growth. However, component shortages and supply chain issues disrupted smartphone sales in H2 of 2021,” Gartner’s report said.
With a yearly increase of 7.6% in smartphone shipments, South Korea’s Samsung maintained its top position with 19% market share last year. It sold more than 272.3 million smartphones in 12 months and the US-based Apple, which accounts for 16.7% of global market share, came second. Apple is expected to launch its iPhone SE 3 soon and it sold 239.2 million smartphones in January-December period.
Chinese brand Xiaomi, which briefly pushed Apple to the third spot in September, occupied the third position.
Global smartphone sales, however, fell 1.7% annually during Q4 of 2021 owing to supply constraints. Apple held the No 1 position among the top five smartphone vendors, helped by strong demand for its 5G-enabled iPhones. It shipped more than 189.3 million smartphones and took 13.2 per cent of the market, the report said.
Samsung registered strong demand for its premium phones in the October-December period, and its sales increased 11 per cent as compared to the fourth quarter of 2020.
“Apple’s strong sales in China in Q4 of 2021 weakened the demand for Chinese smartphones. Oppo and Vivo experienced a decline in sales, whereas Xiaomi held its number three position,” Gartner added.