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This article is more than 1 year old

Smartphone market's lifeless corpse twitches slightly in first sign of growth for two years

It is Halloween after all

Global shipments of smartphones bucked the market's downward trend in the third quarter of 2019 to increase by a paltry 1 per cent – the first signs of growth in two years.

Total shipments were 352.4 million for the quarter, according to analysts at Canalys.

Samsung and Huawei topped the charts with respective increases of 11 (78.9 million) and 29 per cent (66.8 million).

In third spot Apple sold 43.5 million phones around the globe, down 7 per cent, caused mainly by weak sales in the run up to its September launch of the iPhone 11.

Xiaomi and Oppo came in fourth and fifth with sales of 32.5 million and 32 million each.

Canalys research director Rushabh Doshi said: "5G is the next battleground for Samsung. It is one of very few smartphone vendors to design its own chipsets and modems. It is not, therefore, restricted to the innovation cycle of a third-party component supplier like Qualcomm.

"If Samsung moves faster than Qualcomm, it can win the race to mid-range smartphones with 5G. Its recent announcement of the Galaxy A90 5G and the upcoming Exynos 980 chipset highlights its strategic priorities."

The figures also show an impressive recovery from Huawei after the battering it received from President Donald Trump's decision to restrict sales in the US and stop American firms trading with the firm by sticking Huawei on the restricted Entity List.

Although the ban has been put on hold twice while trade negotiations continue, it has cast a large cloud over Huawei's ability to continue to procure US hardware and almost as importantly access to Google's Play Store and other services.

Despite insisting that the Huawei ban is based on national security, Trump has said that the company's status could be included in a wider trade deal with China. According to the president's always stable tweets, that deal is 60 per cent complete and ready for signing.

As reported yesterday, Huawei's growth was fuelled in part by a massive 66 per cent rise in domestic Chinese sales.

But several international distributors also restarted purchases of Huawei so pent-up demand played a role too: international sales rose sequentially from 21.5 million in Q2 to 25.3 million in Q3.

Ben Stanton, senior analyst at Canalys, warned: "Huawei is not out of the woods yet. Its shipments overseas in Q3 were focused on pre-Entity List models, with P30 Lite its best shipper, at close to three million units. But its post-Entity List models, like Mate 30, bring uncertainty because there is resistance from channels in critical overseas markets, like Europe, to support Huawei devices without Google Mobile Services... It will be a major challenge to retain its overseas volume if the Entity List saga is not resolved in the coming months."

Apple's has received strong reviews lauding the iPhone 11's better camera and battery life, though the latest models were only released in the second half of September and so didn't contribute huge volumes to the Q3 shipments.

Canalys said it would not be that surprising if industry talk of an entry-level iPhone launching in the first half of 2020 to bolster sales turned out to be true. ®

 

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