Samsung suffers worst decline in smartphone sales; iPhone 7 struggles

Samsung's smartphone sales suffered a big blow due to the Galaxy Note 7 battery issue.

A woman walks past a Galaxy Note 7 poster. Photo: Reuters

Samsung's smartphone sales fell 14.2% in the third quarter, its worst ever, Gartner said.

“The decision to withdraw the Galaxy Note 7 was correct, but the damage to Samsung's brand will make it harder for the company to increase its smartphone sales in the short term,” said Anshul Gupta, research director at Gartner.

Samsung's Q3 sales declined to 71,733 units from 83,587 units in the same quarter last year.

Competitor Apple Inc too has seen a fall in sales during the third quarter despite the launch of their latest iPhone 7. The report said that the iPhone 7 struggled to stimulate replacement sales.

Apple's iPhone sales declined by 6.6% in Q3. Apple accounted for 11.5% of the global smartphone market, its lowest share since the first quarter of 2009.

The sales of the iPhone declined to 43,000 units in Q3 from 46,062 in the same quarter last year. Apple's sales fell by 8.5% in the US and by 31% in China, two of its biggest markets.

However, Chinese smartphone manufacturers continued their growth run in the third quarter and continued to reduce the distance between the big two Apple and Samsung.

Huawei, Oppo and BBK Communication Equipment together accounted for 21% of the smartphones sold to end users worldwide in the third quarter of 2016. They were the only smartphone vendors in the global top five to increase their sales and market share during the quarter, according to Gartner.

For instance, Huawei posted an 18.5% growth in smartphone sales in Q3 and its market share grew to 8.7% during the quarter from 7.7% in the same quarter last year. Apple's market share, on the other hand, has declined to 11.5% in Q3 from 13% in the same quarter last year. This was less than a three percentage point difference in market share between them in the smartphone market.

“Highly competitive and feature-packed Honor devices maintained their sales momentum in markets around the world, with expansion into Europe and the US likely to help Huawei record another year of promising growth,” said the report.

Oppo mobiles market share doubled to 6.7% in Q3 from 3.4% in the correspondin quarter last year. The smartphone maker sold 24,937 units in Q3 from 11,868 units in the same quarter last year.

BBK Communication Equipment saw an even larger growth in sales as its market share grew to 5.3% from 29% last year.

Global sales of smartphones to end users totaled 373 million units in the third quarter of 2016, a 5.4% increase over the third quarter of 2015. However, overall sales of mobile phones, fell by 1.3%, largely due to the declining popularity of feature phones.

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