Direct Hit from COVID-19... Samsung Electronics, 'No.1 Smartphone', Also Took the Biggest Hit

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[Asia Economy Reporter Seulgina Jo] The global smartphone market took a direct hit in the first quarter due to the impact of the novel coronavirus disease (COVID-19). Samsung Electronics, led by the Galaxy S20 series, maintained its top position but also suffered the largest blow. Chinese company Huawei also recorded a double-digit decline. Concerns are mounting that the situation will worsen in the second quarter.

According to market analysis firm Canalys on the 4th, the global smartphone shipment volume in the first quarter (January to March) was 272.5 million units, a 13% decrease compared to the same period last year (313.9 million units).

By company, Samsung Electronics' shipment volume fell 17% year-on-year to 59.6 million units, the largest decline among smartphone manufacturers. Huawei also shipped only 49 million units, down 17% from a year earlier. Apple followed with 37.1 million units, down 8%. On the other hand, among the top 5, Chinese companies Xiaomi (30.2 million units) and Vivo (24.2 million units), which focus on mid-to-low-end models, grew by 9% and 3% respectively compared to the previous year.

Ben Stanton, an analyst at Canalys, summarized the impact of COVID-19 on the smartphone market with the word "Crushed." He explained, "Until February, when COVID-19 spread mainly in China, the market was concerned whether smartphone production would be sufficient to meet global demand. However, production recovered after March, but with half of the world under lockdown (movement restrictions), sales plummeted."

Samsung Electronics recorded the highest market share in the first quarter but dropped 0.9 percentage points year-on-year to 21.9%. Huawei's share (18%) also fell by 0.8 percentage points.

Global Smartphone Shipment Volume in Q1 (Canalys)

Another market analysis firm, IDC, reported that global smartphone shipments in the first quarter (275.8 million units) decreased by 11.7% year-on-year, marking the largest quarterly decline ever. By region, China, the world's largest smartphone market and accounting for a quarter of global exports, saw a 20.3% decline. Shipments in the U.S. and Western Europe also fell by 16.1% and 18.3%, respectively. Nabila Popal, head of IDC's research division, explained the COVID-19 impact, saying, "Initially, it started as a supply chain issue limited to China, but by the end of the quarter, it became a global crisis affecting overall demand."

By company, Samsung Electronics' shipment volume shrank 18.9% from 71.9 million units in the first quarter last year to 58.3 million units this year. Its market share (21.1%) also dropped by 1.9 percentage points. Both shipment volume and market share declines were the largest among the top 5.

However, IDC stated, "Samsung Electronics still holds the number one market share," and noted, "They launched the Galaxy S20 series and continue to succeed with the A series." Strategy Analytics (SA) commented, "Samsung's smartphone shipments in the first quarter were the lowest in the past eight years. Despite a strong lineup, they could not avoid the demand plunge caused by COVID-19," but also mentioned, "It remains the world's top brand with a market share exceeding 21%."

Global Smartphone Shipment Volume in Q1 (Source: IDC)

The industry expects the smartphone market to reach the peak of COVID-19 impact in the second quarter. Apple reflected these concerns by not providing guidance for the next quarter during its earnings announcement.

Counterpoint Research analyzed, "In uncertain times, consumers are more likely to postpone smartphone purchases," adding, "The replacement cycle for smartphones may lengthen." They also noted, "Quarterly shipment volumes below 300 million units are the first since early 2014." IDC forecasted, "As the spread of COVID-19 has recently started to slow, demand in China is recovering faster than expected," but predicted growth compared to last year only in the fourth quarter of this year.

This content was produced with the assistance of AI translation services.