Handset/IT Industry
The author is an analyst for NH Investment & Securities. He can be reached at kyuha.lee@nhqv.com -- Ed.
In March, global smartphone sales continued to fall y-y. But, the pace of slowdown narrowed in China, and sales volume remained impressive for Apple. Moving ahead, demand is to gradually improve on new product launches by Chinese firms in 2Q23 and strong sales of the iPhone 15 series.
Global handset sales decline continued in March, but Apple sales outstrip expectations
In March, global smartphone sales continued to fall, tumbling to 91.19mn units (-13.6% y-y, +1.6% m-m). Although it is positive that the pace of y-y sales drop in China narrowed from February, sales remained weak in most regions, including Europe. A gradual near-term improvement in sales is expected on the launch of new products, and a full-fledged recovery in demand is likely to arrive in 2H23.
By region, smartphone sales in China slid 5.7% y-y, with the rate of decline improving from the 9.9% y-y drop registered in February. Compared to still sluggish local players, Apple’s y-y sales growth was impressive. Amid overall tepid results, sales in Europe continued to fall sharply.
By company, Apple’s market share rose to 18.6%, reaching another high as of March. For reference, the figure came to 11.5% in 2019, 11.3% in 2020, 16.1% in 2021, and 16.8% in 2022. With sales set to further pick up on the launch of the iPhone 15 series in 2H23, Apple’s market share expansion trend is expected to continue.
Demand to improve in 2Q23 and 2H23
Samsung Electronics (SEC) sold 21.27mn units in March (-14.1% y-y, +8.3% m-m), continuing a y-y downtrend. While March sales of the Galaxy S23 series topped 4.46mn units, showing an increase of about 20.8% compared to that for the predecessor Galaxy S22, overall sales volume was weak due to slowdowns in the major US, Europe, and Asia markets.
In the short term, sales recovery is expected on new product launches by Chinese companies scheduled for 2Q23, and overall business conditions should improve in earnest from 2H23 on large-scale upgrades and standby demand for the iPhone 15 series.
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