Gartner: Worldwide smartphone sales recorded first ever decline during Q417; Apple primed for delayed sales boost in calendar Q1

Global sales of smartphones to end users totaled nearly 408 million units in the fourth quarter of 2017, a 5.6 percent decline over the fourth quarter of 2016, according to Gartner, Inc. This is the first year-on-year decline since Gartner started tracking the global smartphone market in 2004.

“Two main factors led to the fall in the fourth quarter of 2017,” said Anshul Gupta, research director at Gartner, in a statement. “First, upgrades from feature phones to smartphones have slowed down due to a lack of quality “ultra-low-cost” smartphones and users preferring to buy quality feature phones. Second, replacement smartphone users are choosing quality models and keeping them longer, lengthening the replacement cycle of smartphones. Moreover, while demand for high quality, 4G connectivity and better camera features remained strong, high expectations and few incremental benefits during replacement weakened smartphone sales.”

Samsung saw a year-on-year unit decline of 3.6 percent in the fourth quarter of 2017, but this did not prevent it from defending its No. 1 global smartphone vendor position against Apple (see Table 1).

Table 1: Worldwide Smartphone Sales to End Users by Vendor in 4Q17 (Thousands of Units)
Gartner: Worldwide Smartphone Sales to End Users by Vendor in 4Q17 (Thousands of Units)
Source: Gartner (February 2018)

Despite the start of a slowdown in sales of Samsung’s Galaxy S8 and S8+, the overall success of those models has helped Samsung improve overall average selling price. Samsung is poised to announce the successors to its Galaxy series of smartphones at Mobile World Congress (MWC) this year. The launches of its next flagship devices are likely to boost Samsung’s smartphone sales in the first quarter of 2018. Although Samsung’s significant sales volumes lean toward midprice and entry-level models, which now face extreme competition and reducing contribution, its profit and average selling price may further improve if these next flagship smartphones are successful.

While Apple’s market share stabilized in the fourth quarter of 2017 compared to the same quarter in 2016, iPhone sales fell 5 percent when comparing Q417’s 13-week quarter to Q416’s 14-week quarter. “Apple was in a different position this quarter than it was 12 months before,” said Mr. Gupta. “It had three new smartphones — the iPhone 8, iPhone 8 Plus and iPhone X — yet its performance in the quarter was overshadowed by two factors. First, the later availability of the iPhone X led to slow upgrades to iPhone 8 and 8 Plus, as users waited to try the more-expensive model. Second, component shortages and manufacturing capacity constraints preceded a long delivery cycle for the iPhone X, which returned to normal by early December 2017. We expect good demand for the iPhone X to likely bring a delayed sales boost for Apple in the first quarter of 2018,” added Mr. Gupta.

Huawei and Xiaomi were the only smartphone vendors to achieve year-on-year unit growth (7.6 and 79 percent, respectively) and grew market share in the quarter. With Huawei’s new smartphone additions in the quarter, including Mate 10 Lite, Honor 6C Pro and Enjoy 7S, the vendor broadened the appeal of its smartphones.

Xiaomi’s competitive smartphone portfolio, consisting of its Mi and Redmi models, helped accelerate its growth in the emerging Asia/Pacific (APAC) market. It also helped Xiaomi win back lost share in China.

“Future growth opportunities for Huawei will reside in winning market share in emerging APAC and the U.S.,” said Mr. Gupta. “Xiaomi’s biggest market outside China is India, where it will continue to see high growth. Increasing sales in Indonesia and other markets in emerging APAC will position Xiaomi as a strong global brand.”

In 2017 as a whole, smartphone sales to end users totaled over 1.5 billion units, an increase of 2.7 percent from 2016 (see Table 2). Huawei, ranked No. 3, raised its share in 2017, continuing to gain on Apple. At the same time, the combined market share of the Chinese vendors in the top five increased by 4.2 percentage points, while the market share of top two, Samsung and Apple, remained unchanged.

Table 2: Worldwide Smartphone Sales to End Users by Vendor in 2017 (Thousands of Units)
Gartner:  Worldwide Smartphone Sales to End Users by Vendor in 2017 (Thousands of Units)
Source: Gartner (February 2018)

In the smartphone operating system (OS) market, Google’s Android extended its lead by capturing 86 percent of the total market in 2017 (see Table 3). This is up 1.1 percentage points from a year ago. “The competition in the smartphone market is unabated at this time of the year,” said Mr. Gupta. “Ahead of MWC, several phone manufacturers such as Samsung, HMD (Nokia), Asus and LG have announced that they will launch new Android smartphones.”

Table 3: Worldwide Smartphone Sales to End Users by Operating System in 2017 (Thousands of Units)
Gartner: Worldwide Smartphone Sales to End Users by Operating System in 2017 (Thousands of Units)
Source: Gartner (February 2018)

Further information is available in the Gartner report titled “Market Share: Final PCs, Ultramobiles and Mobile Phones, All Countries, 4Q17.”

Source: Gartner, Inc.

MacDailyNews Take: Market share is nice, but profit share is far better.

iPhone X drives smartphone revenue dominance; Apple made more money in Q417 than the rest of the smartphone makers combined – February 16, 2018
Apple iPhone took more than half of worldwide smartphone revenue share in Q417, a new record – February 15, 2018
Strategy Analytics: Apple has shipped 1.2 billion iPhones in the past 10 years; $760 billion in global revenue to date – September 8, 2017
Apple took 83% of smartphone market profits in calendar first quarter – May 16, 2017
How important is Apple’s iPhone market share? – May 29, 2017


  1. Impressive that a 14% market share results in 51% of the world-wide revenue, and nearly 90% of the profit. Apple knows what it is doing. Further, a weekly sales analysis, given the 13 vs 14 week quarter comparison actually shows an increase in iPhone sales YOY.

    1. More revenue than all other companies combined.
      Nine times more profit than all other companies combined.

      But these numbnuts twist this into, “… did not prevent it from defending its No. 1 global smartphone vendor position against Apple”.


      1. They are also either willfully lying about the shipments, or someone had a massive typo. Apple sold 77 million last quarter, what the fuck is 73 million doing on there?

  2. At this point and Google aside – is increase in share of sales of phones having little or no margin the best strategy for manufacturers, or is it maintaining a base of loyal customers .. loyal customers that can and are willing to pay a premium of for services?

    I am going the latter. If you are mostly losing money on unit sales, you can’t make it with volume.

    1. As long as a certain percentage of iPhone sales are to new users (which they are) the user base continues to grow. I’ve read some very good analysis that we’re not at the point where Apple’s user base will level out. It’s going to keep growing. If you own Apple stock hold onto it.

      You might have confused unit growth with user base growth. They are two different things. Even the article you link to makes the same point as me:

      “As long as Apple is bringing in new users, a scenario that is likely to continue for at least the next few years, the iPhone installed base will continue to expand.”

      Apple could have 1.5 billion users by the time the user base begins to level out. That’s mind boggling.

  3. These numbers are incorrect. Didn’t Apple sell 77 million? Why do they have 73 million on the sheet? This report is bullshit, it doesn’t even get the numbers right. Wtf?!?

    1. That’s another problem. We see Gartner and IDC guessing about Apple’s numbers because they release these reports at specific times, often before the numbers are in, and don’t always modify them to meet the actual results.

  4. The problem with the numbers of some of these companies, particularly Samsung, is that they are just guesses, because these companies release no sales figures for their phone and tablet product lines. So we really don’t know how many phones Samsung has sold.

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