In first-quarter 2015, smartphone sales reached 310 million units, up 7% year-on-year but slowing from the 19% year-on-year growth in Q4/2014 (which reached 346 million units). This was due to year-on-year shrinkage of -14% in China and -5% in Developed Asia, respectively, according to market research firm GfK.
Likewise, smartphone sales value rose 8% year-on-year to a Q1 record of $96bn, but this represented a slowing from the 20% year-on-year growth in Q4/2014 (to a record $115bn).
In Q1/2015, smartphone sales value in Western Europe fell year-on-year for the first time, dragged down by Spain and France. As smartphone penetration nears saturation point, both countries are expected to see a slowdown in unit growth this year.
In Central Europe, the macroeconomic situation in Russia has significantly impacted sales. GfK hence forecasts that for 2015 smartphone demand in the region will grow more slowly than Western Europe for the first time since 2010.
"The weakness in China was caused by a significant slowdown in 3G demand, which was not offset by 4G growth," notes Kevin Walsh, director of trends and forecasting. "We forecast China to return to growth in the second half of the year, driven by a continued 4G ramp-up," he adds. "In Developed Asia, the year-on-year decline was caused by tough comparisons with Q1/2014, when demand was pulled forward in Japan due to an upcoming VAT increase in April. We forecast unit demand in Developed Asia to grow by +3% year-on-year in 2015, driven by Japan and South Korea, which are expected to return to growth in Q2/2015."
4G ramp-up
In Q1, 4G unit share surpassed 50% of global smartphone demand for the first time. China saw the greatest 4G share increase, up from 57% in Q4/2014 to 73%. Growth has been buoyed by the continued price erosion of 4G smartphones. GfK forecasts global 4G share to rise to 59% in Q4/2015.
Smartphone growth in India and Indonesia is also expected to be helped by an expanding 4G network. In Q1, 4G share in both countries was well below the global average, at 4% and 7%, respectively. GfK forecasts that 4G unit share within smartphones will reach 7% in India and 10% in Indonesia in 2015.
Price band dynamics in Q1/2015
Low-end smartphones (up to $250) increased share to 56%, up from 52% in Q4/2014, at the expense of high-end models ($500+), while mid-range ($250-500) share remained stable. GfK forecasts that low-end smartphones will gain further share in 2015, helped by continued price erosion in emerging markets.
Outlook for 2015
GfK forecasts that global smartphone unit demand will grow 10% year-on-year in 2015, a slowdown from the +23% growth of 2014. "Emerging Asia is forecast to be the fastest-growing region, driven by India and Indonesia, where low smartphone penetration leaves plenty of room for growth," concludes Walsh.
