Handset sales drop for first time in three years

Global sales of mobile phones declined on a qurterly basis for the first time in nearly three years, according to research firm Gartner this week. The two per cent year-on-year drop between the first quarters of 2012 and 2011 marks the first time the market has weakened since the second quarter of 2009.

Global handset sales reached 419.1 million units in the first quarter of 2012, with a decline more than expected due to a slowdown in demand from the Asia Pacific region, according to Anshul Gupta, principal research analyst at Gartner.

“The first quarter, traditionally the strongest quarter for Asia – which is driven by Chinese New Year, saw a lack of new product launches from leading manufacturers, and users delayed upgrades in the hope of better smartphone deals arriving later in the year,” he explained.

The unexpected results have led the research firm to be cautious about sales for the remainder of the year, according to Annette Zimmermann, principal research analyst.

“The continued roll-out of 3G-based smartphones by local and regional manufacturers such as Huawei, ZTE, Lenovo, Yulong and TCL Communication should help spur demand in China,” she said.

“In addition, the arrival of new products in mature markets based on new versions of the Android and Windows Phone operating systems (OSs), and the launch of the Apple iPhone 5 will help drive a stronger second half in Western Europe and North America. However, as we are starting to update our market forecast we feel a downward adjustment to our 2012 figures, in the range of 20 million units, is unavoidable.”

Samsung led in terms of global market share, displacing Nokia which had held the top spot since 1998. The Korean firm’s handset sales reached 86.6 million units, marking a 25.9 percent increase from last year.

Sales of smartphones continued to drive mobile device market growth, reaching 144.4 million units in the first quarter of 2012, up 44.7 per cent year-on-year. Apple and Samsung took almost half of the market share between them, with their combined share standing at 49.3 per cent, up from 29.3 per cent in the first quarter of 2011.

Worldwide Mobile Device Sales to End Users by Vendor in 1Q12 (Thousands of Units)

Source: Gartner (May 2012)