Global Smartphone Sales Down 20 Percent in Q2 Due to Covid-19

Global Smartphone Sales Down 20 Percent in Q2 Due to Covid-19

Global smartphone sales fell by 20.4 percent in the second quarter of 2020, to 295 million, as the mobile phone industry continued to experience the effects of the Covid-19 pandemic, according to a new research report.

Most major markets, except China, continued to have some form of shelter-in-place restrictions for most of the quarter, leading to continued falling demand for smartphones. Among the top five vendors, Samsung saw the biggest drop in sales, with Apple iPhone sales almost flat year-on-year.

Samsung sold 54.76 million smartphones in Q2 2020, down 27.1 percent from 75.11 million units a year earlier, for an overall market share of 18.6 percent. Huawei was in 2nd place with 54.12 million, down 6.8 percent from 58.05 million units in Q2 2019, for a market share of 18.4 percent. Apple sold 38.39 million units for a 13 percent market share, down 0.4 percent from 38.52 million a year earlier.

Tarifica’s Take

As we have noted recently, the global pandemic has had a variety of effects on telecom markets. On the one hand, stay-at-home orders and work-from-home arrangements have stimulated data and voice usage, while on the other hand, the economic impact of the pandemic has made it harder for many users to pay for services and to purchase devices.

The research study under discussion reveals a telling fact—that smartphone sales have been seriously dampened by Covid-19 across most world markets. The reason for this is likely twofold. The most remarked upon is the economic effect of the pandemic, as mentioned above. Users who have been deprived of income due to unemployment or wage reduction have less ability to purchase new devices, and this of course must be a large component of the 20 percent downturn in sales.

However, it is also the case that as users spend more time at home, they are likely to get their internet connectivity more from computers and broadband rather than from mobile handsets. In particular when it comes to working from home, even voice communications are going less often through smartphones and more often through Zoom and other video calling platforms. This trend must also be affecting decline in smartphone sales during the second quarter, the quarter in which the pandemic was at its height.

While we cannot know how long the pandemic will last, or how long its effects will linger after it is past, mobile operators and device manufacturers will suffer the effects of this major contraction in smartphone sales. Competitive pricing can help, especially in the context of service plans. Beyond that, mobile operators may want to look into other types of devices, such as mobile hotspots, that could find more eager purchasers during the stay-at-home period.