Report: Phone Market Down in 2Q, Android Growth Outpaces Apple

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The overall worldwide mobile phone market shrank in second quarter of this year but smartphone sales, led by Samsung and Apple, saw a healthy increase, according to information released by research firm Gartner Tuesday. Total sales to end users were 419 million units for the quarter, a 2.3 percent decline from the same quarter last year, while smartphones sales grew 42.7 percent during the same period.

“Demand slowed further in the second quarter of 2012,” said Anshul Gupta, principal research analyst at Gartner. “The challenging economic environment and users postponing upgrades to take advantage of high-profile device launches and promotions available later in the year slowed demand across markets. Demand of feature phones continued to decline, significantly weakening the overall mobile phone market.”

Hardware Sales

Handset giant Samsung saw a strong increase in sales, moving 90.4 million handsets to end users in the quarter, up from 69.8 million last year. Conversely, struggling Microsoft partner Nokia saw a decrease in sales, down to 83.4 million from 97.8 million in the second quarter of 2011.

Gartner 2q2012 Hardware Sales

Apple sales in the second quarter fell 12.6 percent from the first quarter of this year but grew when compared to the same quarter last year, capturing 6.9 percent of worldwide sales and increasing sales from 19.6 million in the second quarter of 2011 to 28.9 million in 2012. Gartner was quick to point out that Apple’s simplified product line and roughly once-per-year release schedule causes a sales lull as anticipation for the next phone grows.

Depending on the exact launch date of the new iPhone, Apple might experience another weaker-than-usual quarter in the third quarter of 2012, while Apple will be ready to take advantage of the strong holiday sales in North America and Western Europe that have historically remained immune to economic pressure.

LG, HTC, Motorola, and RIM all saw their sales numbers decrease for the quarter although, with its plans to “reinvent” the company, Google hopes to pull Motorola from the loss category in the coming quarters.

As smartphones become more capable and more accessible, their market share will continue to increase at the expense of feature phones. The primary concern for the industry is whether smartphone adoption rates can outpace the feature phone losses and keep the overall market growing.

“High-profile smartphone launches from key manufacturers such as the anticipated Apple iPhone 5, along with Chinese manufacturers pushing 3G and preparing for major device launches in the second half of 2012, will drive the smartphone market upward. However, feature phones will continue to see pressure,” Mr. Gupta said.

Gartner expects 1.9 billion phones to be sold by the end of 2012.

Operating System Share

Looking at the mobile OS market, Android and iOS together control nearly 83 percent of market share, with Android taking, by far, the largest piece of the mobile OS pie.

Gartner Mobile OS 2Q2012

Android growth outpaced all others, increasing 20.7 percent to 64.1 percent of the market in the second quarter. In comparison, Apple’s iOS grew only slightly, by 0.6 percent, to take 18.8 percent of the second quarter marketshare.

Symbian and RIM fell heavily from the same quarter last year while Bada and Microsoft both grew slightly, to each take 2.7 percent of the market.

Upcoming mobile hardware and software launches from Apple and Microsoft may have a significant impact on Q3 and Q4 numbers. Apple is expected to release its next iPhone at a special media event on September 12.

Teaser graphic via Shutterstock.

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Comments

Winky Dink

Enough of the sales numbers….there are more Android running phones in the world then iOS. 

Move on to something worth reading…

John Molloy

Enough of the sales numbers?.there are more Android running phones in the world then iOS.?

And so Android has successfully supplanted Symbian.

paikinho

And so Android has successfully supplanted Symbian.

And Apparently RIM.

Basically, iOS will end up with 20%+ of the total future phone market while android based phones will have the rest.

Android will run the gamut from chintzy plastic junk disposable phones to units which are on par with an iPhone, while the iPhone will continue to just be the iPhone and hog up almost all of the revenue in the industry.

That is until the new paradigm communication device comes along; whatever and whenever that might be…...

mrmwebmax

+

Enough of the sales numbers?.there are more Android running phones in the world then iOS.?

Move on to something worth reading?

Umnn…you do realize that this is an Apple enthusiast site, right? And that there are many of us here who come here to read exactly this type of article?

mrmwebmax

+

Android will run the gamut from chintzy plastic junk disposable phones to units which are on par with an iPhone, while the iPhone will continue to just be the iPhone and hog up almost all of the revenue in the industry.

Exactly. For all of those who say that Android/iOS is Windows/Mac OS repeating itself, the irony may be that, in a way, they’re right: With Android being analogous to Windows, Android OEMs are analogous to Windows PC OEMs, meaning that they are all in a race to the bottom on price, quality, and profit margin. Lok how well that worked out for the PC industry! Not too well. Sure, there are many more Windows PCs out there than Macs, but how many PC OEMs and Android OEMs can claim themselves as the most valuable company on the planet?

Remember this startling fact, too: iPhone isn’t more profitable than Windows Phone. It isn’t more profitable than Office. It isn’t more profitable than Windows, XBox, Kinect, and other Microsoft products. Rather:

iPhone is Bigger and More Profitable Than ALL of Microsoft Put Together

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