Counterpoint Research’s team of Analysts have completed preliminary sizing of the global handset and smartphone market as few OEMs have already released their Q4 2015 (Oct-Dec) performances. The following are our preliminary market share estimates and rankings according to our quarterly Market Monitor service.
Overall Market :
- Smartphone shipments reached 418 million units (+9% YoY) in holiday season quarter of 2015 and a massive 1475 million units for full year 2015(+12% YoY).
- 3 in 5 smartphones shipped in 2015 were LTE capable i.e. 900 million LTE smartphones were shipped globally in 2015, a breakout year for the mobile industry.
- 3 in 5 smartphones shipped in premium segment (>$400) in 2015 were iPhones.
- Close to 850 brands are competing in the smartphone market, however the top 20 commands almost 85% of the total smartphone shipments in 2015.
- The entry level and premium smartphone segments combined contributed to more than half of the total shipments in CY 2015.
- Local brands especially from China and India showed promising growth in smartphone shipments.
- While local brands targeted first time smartphone buyers through aggressive pricing and targeted go-to-market strategies, Chinese brands moved beyond domestic boundaries in pursuit of growth as the China smartphone market saturates.
- Oppo & Vivo were the star performers followed by Huawei & Apple among the top ten smartphone brands globally
- Meizu, Lava, Intex, Asus, Tecno were other brands with growth rate above 100%, gaining prominence and moving up the smartphone rankings.
- Samsung shipped 81.5 million smartphones with a sequential decline of 3% and YoY increase of 10%.
- The overall smartphone shipments were driven by emerging countries such as India, South East Asian markets including Indonesia and Vietnam, and LATAM countries including Brazil and Mexico.
- However it continues to lose market share in key mature markets, in some emerging markets – to local brands – and to Apple in the premium segment.
- Samsung’s J series continues to drive volumes for Korean giant as it ramped up the series by launching multiple SKUs in the entry to mid-level segment. It used its distribution prowess to gain much needed foothold in the $100-$200 segment where it is facing stiff competition from local and Chinese brands.
- During the quarter, the demand for its mid level A series was soft, mainly driven by models like A7, A5. It was unable to arrest the decline of its E series and other mid level smartphones.
- In the premium segment, the Galaxy Note series, especially Note 5, was the lone challenger as demand for its S6 series remained below expectations, in spite of drop in the price of some SKUs.
- Calendar Q4 2015 was the best ever iPhone quarter for Apple, as it registered the highest ever iPhone shipments, revenues and ASP. iPhone shipments peaked at 74.8 Mn during the quarter though shipments were flat as compared to YoY.
- iPhone continues to be Apple’s linchpin – contributing 66% of the company’s revenues.
- According to our quarterly tracker, Apple iPhones continues to capture almost 40% of the smartphone industry hardware revenues.
- Apple also crossed an important milestone as the installed base of Apple devices surpassed 1 billion (incl. Macs, iPods, iPhones, iPads, Apple TV & Watch).
- 2015 was a phenomenal year for Apple’s growth with a major contribution coming from Greater China.
- Apple is fighting for the top spot with Huawei to become the number one smartphone brand in China.
- Apple hopes to still continue to grow more in China, wooing the sizeable middle class consumer segment with its aspirational products from iPhone to Apple Watch.
- Apple would like to replicate this growth story into other large emerging markets such as India,Indonesia and key markets in Africa.
- While 2015 has been a record year for Apple, the most recent quarter also signals why investors and Apple should be concerned as demand has peaked and is projected to slow, signalling much tougher times ahead.
- Huawei continues to be among top three smartphone brands globally with a smartphone market share of 8% during the quarter.
- Huawei’s smartphone shipments increased sequentially by 21.8% and 38% annually reaching 33.4 million units.
- Huawei surpassed its annual target of 100 million smartphone shipments in 2015.
- North America was the bright spot during the quarter as Huawei showed a QoQ growth of 277% in the region mainly driven by Nexus 6P – although this growth is from a low baseline.
- With the success of Nexus 6P in US market Huawei is looking to rebuild its brand value and market position in North America.
- Honor brand is yielding results for Huawei with a presence in more than 74 countries around the globe and contributed to more than a third of the shipments.
- Honor brand helped Huawei successfully penetrate emerging countries like India with aggressive pricing and the Ascend series continues to do well in Middle East Africa and Europe.
- The Chinese vendor also strengthened its market share in flagship segment in 2015 leading to increasing in overall ASP driven by high end Mate and Ascend series.
- While Xiaomi continues to be among top 5 in smartphone segment the Chinese brand missed its revised handset shipment goal of 80 million unit; shipping slightly over 70 million units.
- During the Dec ending quarter, Xiaomi shipped 17.8 million smartphones as market share stood at 4%.
- With YoY growth of just 2%, Xiaomi was unable to scale in countries beyond China.
- The overseas shipments contribution increased to 8% in CY 2015 still much below expectations.
- IP issues, lack of differentiation and its inability to to scale the MI ecosystem in countries beyond China were some of the key reasons for the slow down.
- Its portfolio strategy for overseas marketing was not robust as it was unable to refresh its product portfolio in key countries like India while launching new models like Redmi Note 2 and Redmi Note 3 in home territory.
- Xiaomi is scaling up its offline operations to arrest the slow down but it will come at a cost of profitability and entering newer markets such as S.Korea and potentially USA through open channels.
- Lenovo (+Motorola) smartphone shipments were down 19% annually but grew by 7% sequentially.
- Lenovo performance in China remained flat as it was unable to drive volumes. However, Lenovo’s growth outside China – for example in India, Middle East and South Asia, has helped it to surpass Xiaomi during the quarter.
- Lenovo K-note series has been very popular in Asia, for example it has been one of the top three selling models in India.
- Motorola on the other hand had grew by 11% during the quarter but future outlook for the brand looks bleak as it paves way for parent brands Vibe series in mid segment and restricting itself to higher segment only.
- The overall shipments for the entire 2015 declined by 20% YoY mainly due to Lenovo’s performance in China.
- LG smartphone shipments were up by 3% sequentially in Q4’2015.
- As a result, smartphone shipment of LG increased from 59.2 million to 59.7 million units in 2015 over 2014.
- Its flagship G4 didn’t perform as per expectations and the mid segment faced stiff competition from chinese and local brands.
- LG needs to chase volumes in mid segment by lowering ASPs as brand loyalty is slowly fading in that segment. On flagship strategy it need to launch more than one flagships a year and do away with its strategy of mini flagships and launch an entirely new portfolio.
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