Counterpoint Research team of Analysts have completed preliminary sizing of the global handset and smartphone market as few OEMs have already released their Q1 2015 (Jan-Mar) performances. Following are our preliminary market share and rankings according to our quarterly Market Monitor service.     The key highlights of the quarterly performances so far include: Market:
  • Global mobile phone shipments reached a record March quarter reached 441 million units up 2% YoY but down 16% QoQ as some markets such as China, India, USA and Europe slowed down
  • Smartphone shipments also climbed to an all-time record of 342 million units for the March ending quarter  growing 16% YoY
  • Smartphone now represent 78% of all mobile phones shipped during the quarter (68% in Q1 2014) as feature phone demand continued to shrink fast globally.
  • Rising proliferation of LTE smartphones is driving smartphone demand in markets such as China, Europe  and others. Countries such as India, Brazil, Russia, Malaysia are also seeing rise in launch of number of LTE handsets
  • Meanwhile in emerging markets there is also a swift transitioning from 2G smartphones and feature phones to 3G smartphones with increasing demand in sub $100 retail smartphone segment
  • Chinese brands continue to rise on their smartphone designs which are getting thinner and metallic, narrowing portfolios, multiple brands for multiple channels allowing them to penetrate further in the market
  • Apple smartphone shipments rose to a record high for the March quarter behind Samsung as the shipments declined sequentially coming from a strong holiday season quarter, though was one of the fastest growing smartphone brand
  • Lenovo (Motorola included) was the third largest smartphone followed by Huawei, Xiaomi & LG in spite of softness in domestic demand in China for Lenovo smartphones
  • The top eight smartphone brands together captured almost two-third of the global smartphone market

Exhibit 1: Overall Mobile Handsets* 

 Exhibit 2: Smartphones*

Q1 2015 Market Monitor - Counterpoint Research - Smartphones updated

*preliminary estimates will be updated as brands formally report - The chart has been updated with latest LG numbers. Close race between Xiaomi & LG in smartphone segment

Samsung

  • Samsung shipped 99 million mobile phones down 12% annually as the feature phone volumes declined QoQ & YoY
  • Smartphone shipments however rose to 83.3 million units up  12% sequentially but down 6% annually, though taking back the leading position in smartphone segment from Apple after Apple's solid holiday season quarter of 2014
  • Samsung's mid- to high tier new Galaxy A/E/J series drove the smartphone volumes up sequentially
  • However premium ($450+) smartphone shipments with S5 & Note 4 shipments declined as the premium segment was dominated by Apple, ahead of Samsung Galaxy S6 roll out in Q2 2015
  • In terms of regional performance, Samsung's position in markets such as India, MEA and South East Asia improved on par with last year but China, Latin America and Europe the position weakened annually
  • We continue to recommend Samsung to significantly cut down on hundreds of SKUs to a few which will immensely help Samsung focus on its products design, experience and generate greater scale to improve profitability which is lurking around 10-11% from 20% level when Samsung was at peak
Apple 
  • Apple posted yet another strong quarter for both revenue and sales for iPhone with shipments at 61.2 Mn during the quarter, a Y-o-Y increase of almost 40%.
  • As a result, Apple iPhone revenues are now at all-time high i.e 70% of total Apple revenues.
  • Apple’s overall handset market climbed to 14% and the smartphone market share climbed to 18% during the quarter
  • The popularity of higher capacity offering led to iPhone ASP of $659 an increase of $62 annually driving healthy top and bottom lines
  • With iPhone 6 and 6 Plus, Apple has successfully retained its user base and also recaptured most of the previous iOS users who had defected to Android because of larger screens
  • China continues to be the strongest market for Apple as it now corresponds to almost 30% of the total corporate revenues
  • Regionally, iPhone recorded strong sales in countries like Korea, Singapore, Taiwan ,Vietnam,Canada, Mexico,Germany and Turkey
  • Apple is becoming a strong emerging markets player with highly aspirational brand value driving demand not only from rich urban consumers but also beginning to penetrate and capture a good share of middle class consumers'  wallet
Lenovo (+Motorola)
  • Lenovo (+Motorola) combined shipments during the quarter is estimated to be close to 22 million units
  • This cements Lenovo as the third largest smartphone OEM capturing slightly under 7% market share
  • With Motorola, Lenovo now has reach beyond its home market especially in Americas. However, Europe is still a weak spot for the chinese vendor
  • Lenovo is stronger in low- to- mid tier whereas Motorola is more in mid- to high-tier and is helping Lenovo extend portfolio across all price-points and geos
  • During the quarter Motorola launched refreshed version of Moto e with greater focus on emerging markets with this model
  • Lenovo is slowly moving towards and all-LTE portfolio in China and couple of sub $100 wholesale releases of affordable LTE phones (e.g. Lenovo A7000) in other emerging markets such as India
  • Lenovo's growth remains strong outside China whereas Motorola remains strong in Latin America and emerging Asia
Huawei
  • Huawei surpassed Xiaomi to be  the 4thlargest smartphone vendor with market share of 5% during 1Q 2015
  • Smartphone shipments grew by 27% Y-o-Y whereas the overall mobile phone shipments grew by 21% Y-o-Y
  • Honor brand is yielding results for Huawei with a presence in more than 60 countries around the globe.
  • Honor brand has given successful entry in emerging countries like India where traditionally it was not strong whereas Ascend is doing well Middle East Africa and Europe
  • North America remains a weak spot for Huawei whereas Latin America has been strong especially, Mexico, Columbia and others.
  • Apart from this Honor brand has managed to gain significant share in mid to high end smartphone segment, a segment which was traditionally a weak spot for Huawei
  • Going forward it will continue to leverage the momentum by launching more flagships in various geographies along with its online only business model in some of the regions
  • Huawei has shifted focus towards profitability and streamlining portfolio with mid- to premium tier models rather than focusing on lower price models and aims to ship 100 million smartphones in 2015
LG
  • LG shipped almost 20 million mobile phones out of which 15.4 million smartphones to maintain spot in the top five rankings
  • LG captured 5% share in smartphone segment as volumes grew above the market average by 25% YoY
  • North America remained the bright spot with proliferation of mass market smartphones and feature phones across carriers, especially in prepaid segment
  • Americas (North + Central & Latin) contributes to more than three-fourth of total smartphone sales for LG
  • Big and important fast growing markets such as China, India and Rest of Asia remains weak spot for LG
  • Moving forward, with the launch of cutting edge LG G4 and refreshed mid-tier portfolio we estimate LG to challenge Samsung in key markets such as North America and Europe but LG will have to rise about the Samsung marketing noise to make real impact
Xiaomi
  • Xiaomi slipped out of top 5 rankings in smartphone segment as LG crept ahead of Xiaomi in Q1 2015
  • Key reason being Xiaomi's shipments declined sequentially 10% on account of lower than expected sales in Greater China region with tough competition from Meizu, Huawei and Apple
  • Xiaomi market share in Global smartphone market for 1Q 2015 stood at 5%.
  • Furthermore, Xiaomi is now selling its smartphones to more than seven countries outside China and achieved a notable feat of crossing Million sales within five months of launch in India.
  • It has also expanded its distribution strategy from Online only to Hybrid in countries like India and Indonesia.
  • However going forward it will continue to invest in regional content platforms in countries like India and Indonesia and at the same time expanding in new regions like LATAM
  • India has become its biggest market outside China where it has plans to invest locally in terms of developing locally relevant apps with MiUi now supporting six India languages.
  • However in the west where the barriers to entry are high, Xiaomi entered the USA market this quarter with the launch of its accessories and other products through its portal mi.com
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About Author

Neil is a sought-after frequently-quoted Industry Analyst with a wide spectrum of rich multifunctional experience. He is a knowledgeable, adept, and accomplished strategist. In the last 11 years he has offered expert strategic advice that has been highly regarded across different industries especially in telecom. Prior to Counterpoint, Neil worked at Strategy Analytics as a Senior Analyst (Telecom). Neil also had an opportunity to work with Philips Electronics in multiple roles. He is also an IEEE Certified Wireless Professional with a Master of Science (Telecommunications & Business) from the University of Maryland, College Park, USA.