Apple, Huawei Slump, as Samsung Reclaims First Spot in Q3 Smartphone Vendor Top 5 Table

After months of reeling, Samsung has picked up pace once again to reclaim its position as the world’s largest smartphone vendor. The South Korean phone maker took the first position ahead of Huawei, who has recently been struggling due to US sanctions that have limited its access to smartphone chips.

Q3 reports from research firms, International Data Corporation (IDC) and Canalys shows Samsung having 23 percent share of the smartphone market, while Huawei falls back to 2nd place on 22 percent year-on-year drop in product shipment across international markets and its home country China.

Though worldwide smartphone shipment declined 1.3% year over year due to coronavirus pandemic, the third quarter 2020 saw an increase in demand of smartphones.

A total of 353.6 million smartphones were shipped during Q3, due to the reopening of economies as COVID-19 restrictions were eased around the world. The supply is seen as a positive sign of recovery for the smartphone industry.

“While some of the topline numbers may not seem pretty, we are seeing a lot of improvement in the smartphone market both in terms of supply chains and consumer demands,” said Ryan Reith, program vice president with IDC’s Worldwide Mobile Device Trackers.

Samsung took back top position, claiming 22.7% of the market share with shipment of 80.4 million smartphones.

There was significant decline in developed markets, especially in North America, Western Europe and China. But emerging markets, such as Brazil, Indonesia, and Russia, which rank fourth, fifth, and sixth in the world experienced strong growth, according to IDC’s report.

However, Samsung’s rebound came from its major strongholds, the US and India markets. The South Korean vendor raked in 15% of the total sale from India, its largest market; while in the US, its second largest market, sales, especially from Note 20 and Note 20 Ultra, accounted for 20% of Q3 total volume.

The increase in sales in India despite fierce competition from Chinese competitors, Xiaomi and Oppo is as a result of anti-China sentiment and the recent price cut strategy adopted by Samsung.

“Samsung suffered in Q2 due to its dependence on offline retail, but Q3 saw a major recovery. Its momentum was fueled by three key factors.

Firstly, in many regions it saw pent-up demand from Q2 spill over into Q3. Secondly, it regained second place in India, as its Korean brand was shielded from anti-Chinese sentiment. Thirdly, Samsung ramped up its launches of low-to-mid-range devices, and introduced other incentives, such as discounts and free online deliveries, to stimulate demand,” said Canalys analyst Shengtao Jin.

Nabila Popal, research director with IDC’s Worldwide Mobile Device Trackers also remarked that distance learning in India, actually boosted the demand for low-end smartphones as they are a more affordable option compared to tablets.

Samsung came from Q2, where Huawei was at top spot due to the pandemic induced depressing smartphone demand, to stage a comeback due to these strategies it adopted in India and also US sanctions on Huawei.

Huawei lost the top spot and settled into the second position with 51.9 million smartphones shipped and 14.7% share. This followed over 15% decline in China and continued decline in its international market share, all resulting in a large drop of 22% year over year.

Xiaomi came third with 46.5 million device shipment, beating Apple for the first time with 13.1% share and 42.0% growth. Despite fierce competition and anti-China sentiment in India, the Chinese vendor has managed to secure 53% growth in the Q3 2020.

IDC attributed Xiaomi’s growth to its production capacity recovered to nearly 85% of its pre-pandemic level, which helped to cater for strong demands. Other factors that helped its growth include Xiaomi’s low-end portfolio, particularly the Redmi 9 Series, that recorded sales boom in both India and China; and the launch of mid-range Redmi K30 Ultra and high-end MI 10 Ultra which were also successful.

Apple’s Q3 report came with disappointing figures that placed the US smartphone maker in fourth position. The California-based vendor shipped a total of 41.6 million iPhones for the quarter, recording 10.6 decline year over year.

The report attributed the drop to the delay in the launch of the new iPhone 12 series, which usually happens in the third quarter. But the Q2 result showed growth from devices such as the iPhone SE.

“Regardless, the iPhone 11 series did exceptionally well, contributing the majority of Apple’s volume, followed by the SE device,” the IDC report said.

Vivo returned to top five with 31.5 million units shipped for 4.2% year over year growth and 8.9% market share. The report attributed its comeback to share increase in India and China markets. Vivo’s under $200 low-end models delivered 30% year over year growth in India.

In China, the brand enhanced the market positions of its S, iQOO, and X series phones that helped continue its strong presence there, the IDC report said.

There is hope that the fourth quarter of the year will give brands like Apple a chance for rebound, with its 5G enabled iPhone 12 paired with robust trade-in offers across major carriers.

However, the second wave of COVID-19 that is forcing another phase of shutdown across Europe is posing a threat to the sustainability of Q3 growth. The second wave will likely force the governments to roll out fresh stimulus, and companies to lay off workers. The widespread bankruptcy that will result from these developments would kill the gains of Q3.