Russia smartphone shipments grew 6% annually, Samsung & Apple captures a record 2/3rd of the market by value

Growth in smartphone shipments signals a rise in consumer spending as Ruble stabilizes

New Delhi, Mumbai, Hong Kong, Seoul, London, Buenos Aires – May 17th, 2017

According to the latest research from Counterpoint’s Market Monitor service, Russia smartphone shipments grew 6% annually during Q1 2017 but declined 42% sequentially.

Commenting on the results, Associate Director, Tarun Pathak said, “2017 started off on a positive note compared to the same period in 2016, when market was still recovering from the recession that started in late 2014.  Although a clear recovery in consumer spending is yet to be seen, the increase in the smartphone market is an indication that consumers are starting to invest in purchasing new smartphones. This also led to new handset vendors targeting the Russia market as part of their global expansion”

Research Associate, Minakshi Sharma further added, “In Q1 2017, the average selling prices of smartphones in Russia increased 5% YoY and 16% sequentially due to an increased mix of mid-end smartphones. In addition, existing Chinese smartphone brands are expanding their operations in Russia by offering competitive specifications at attractive prices. This is helping them to secure distribution tie-ups within the country.”

Market Summary:

• Russia’s handset and smartphone markets grew by 11% and 6% YoY respectively in Q1 2017.
• Samsung led both overall and smartphone segments with market shares of 21% and 31% respectively.
• Apple was the second largest smartphone brand in Russia with a market share of 12% by volume. However, the iPhones 5S still captured a quarter of Apple shipments.
• Samsung and Apple captured a record 2/3rd of the smartphone market by value.
• Huawei was the leading Chinese smartphone brand with a market share of 9% followed by ZTE with 4%.  Both Huawei and ZTE were among the top five smartphone players in Russia capturing #3 and #4 places respectively.

Exhibit 1: Smartphone Market Share Q1 2017 by volume in Russia

• Global brands captured almost 55% of the smartphone segment followed by Chinese brands with a combined 26% share. Chinese brands are aggressively partnering with leading local mobile distributors in Russia to mark their presence in this growing market. Xiaomi, which entered the Russia market recently, is now ramping-up by developing offline sales channels and opening retail shops.

 Exhibit 2: Global vs Chinese vs Local Brands

• Russian local smartphone brands grew by almost 101% YoY. Local brands like Tele2 (26%), Digma (24%) and Prestigio (13%) showed positive YoY growth.
• LTE capable smartphones contributed 71% of total smartphone shipments in Q1 2017. LTE smartphone segment in Russia increased by almost 64% YoY.
• Almost 24% of LTE smartphones were available in the $100-$150 price band.
• MediaTek embedded smartphones contributed to almost 39% of total smartphone shipments.
• Low-end smartphone segment ($100-$150) witnessed the highest growth of 24% YoY. Most of the growth is being driven by Samsung (51%), Bright & Quick (12%) & Tele2 (9%).
• Premium segment >$600 grew a healthy 143% YoY. Apple and Samsung captured over 95% market share in the segment.
• Almost 52% of the smartphones shipped during Q1 2017 were Phablets (>=5 inch displays), which grew by almost 50% YoY.
• Over 15 new brands have entered Russia handset market in the past one year.

Exhibit 3: Russia Handset and Smartphone Shipments Market Share in Q1 2017

Source: Counterpoint Research Market Monitor Q1 2017

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• Minakshi Sharma
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