Market reels as pandemic hits phone shipments

Worldwide phone shipments fell 14 per cent in the second quarter of 2020. Analyst company Canalys reports that every brand except Apple saw a drop.

It was the second quarter in a row to see a drop in phone shipments. Phonemakers shipped a total of 285 million phones during the quarter. This compares with around 350 million phones shipped in the same period a year ago.

Not only did the Covid-19 pandemic hit sales, it closed factories and disrupted supply chains. People were less able to get out and shop for new phones, yet they chose not to order online.

Phone shipments down as money goes elsewhere

If anything, money that may have been earmarked for phones was spent on computer hardware enabling people to work from home. Other potential buyers hung onto their money as they face financial uncertainty.

Apple was the bright spot. iPhone sales were up 25 per cent on the same period last year. It remains the third largest phone maker in terms of unit sales behind Huawei and Samsung. The company’s market share climbed from around 11 percent to roughly 16 percent.

Canalys says the new iPhone SE accounted for around 28 per cent of its sales. It reports: “Apple is demonstrating skills in new user acquisition. It adapted quickly to the pandemic, doubling down on the digital customer experience as stay-at-home measures drive more customers to online channels.”

The iPhone 11 was Apple’s best seller taking 40 per cent of sales.

Last week this blog reported on Huawei overtaking Samsung as the largest phone maker.

Canalys sounds a warning note about future sales. It says consumer purchasing power has stayed stable thanks to government stimulus packages. The market now faces problems as the stimulus money ends and expected job losses mount.