GfK: Global smartphone growth slows as demand drops in some regions

The value of smartphone sales increased 8 per cent year-on-year to a new record of $96.2 billion (€84.7 billion) in the first quarter of 2015, but the rate of growth slowed considerably from 2014 due to weaker demand in some key regions.

According to German research company GfK, the 8 per cent rise in Q1 2015 compares with a 20 per cent increase in smartphone sales value recorded in the fourth quarter of 2014.

The slowdown in growth was primarily due to a decline in 3G demand in China that was not offset by the growing demand for 4G, although GfK expects to see a rise in 4G demand in China in the second half of the year.

Furthermore, the value of smartphone sales in Western Europe declined on a year-on-year basis for the first time in the first quarter of 2015, dragged down by Spain and France. GfK also noted that as smartphone penetration nears saturation point, both countries are expected to see a slowdown in smartphone unit growth this year compared to 2014.

The weaker demand in China as well as in developed markets in Asia also had a dampening effect on unit sales: although global smartphone sales increased by 7 per cent to reach 310 million units shipped, this again represented a considerable slowdown from last year. For example, sales increased by 19 per cent year-on-year in the final quarter of 2014. GfK also noted that year-on-year unit sales rose by 34 per cent in the first quarter of 2014.

On a global level, demand for 4G devices is nonetheless having a significant impact on smartphone sales. The research company noted that 4G is rapidly gaining market share and has surpassed 50 per cent of the global handset market for the first time. GfK forecasts a further increase to a 59 per cent share in the fourth quarter of this year, noting that growth has been buoyed by the continued price erosion of 4G smartphones.

The first quarter of 2015 also saw a continued shift towards larger screen sizes (5"+), where sales of 166 million units equated to 47 per cent of the global smartphone market, up from 32 per cent a year previously.

At the same time, low-end smartphones--those priced in the region of up to $250--increased market share to 56 per cent, up from 52 per cent in Q4 2014, at the expense of the high-end models ($500+), whilst the share of mid-range devices ($250-500) remained stable. GfK forecasts low-end smartphones will gain further share in 2015, helped by continued price erosion in emerging markets.

For more:
- see this GfK release

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