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ID: 220880

URL: https://www.zdnet.com/article/smartphones-apple-gains-on-samsung-but-total-sales-drop-due-to-component-shortages/

Date: 2021-11-24

Smartphones: Apple gains on Samsung, component shortages plague industry

Worldwide smartphone sales dropped by millions. Global smartphone sales to consumers fell 6.8% in the third quarter of 2021 on a year-on-year basis because of ongoing component shortages. Worldwide smartphone sales -- as opposed to shipments -- fell from 366.27 million in Q3 2020 to 342.29 million in the current quarter, according to tech analyst Gartner.  Samsung led Q3 2021 with 69 million units, down from 81 million units a year ago. However, Apple's iPhone sales rose from 40.5 million a year ago to 48.5 million units in Q3 2021.      Not surprisingly, the main reason for the fall in sales was due to industry-wide component shortages. "The current shortage of components, such as radio frequency and power management integrated circuits, delayed smartphone production globally. This disrupted the supply-demand equilibrium, and end-users were burdened with limited choices at point of sale," explains Gartner. Apple isn't immune to the shortages, and last month reportedly cut iPhone 13 production by over 10% because Broadcom and Texas Instruments can't supply enough chips. iPhone 13 shipping estimates currently indicate a two to three week delivery time.  Apple CEO Tim Cook says in the company's Q4 earnings report that sales would have been higher by $6 billion were it not for chip shortages and supply-chain constraints. But, according to Gartner, component shortages were more devastating to low-end smartphones. "Supply constraints impacted the production schedule of basic and utility smartphones much more than premium smartphones," says Anshul Gupta, senior research director at Gartner. Despite Samsung sales slipping, Gartner believes its premium foldable phones Galaxy Z Fold 3 and Galaxy Z Flip 3 sold well.  The top five vendors by sales were Samsung, Apple, Xiaomi, Vivo, and Oppo.  Apple reclaimed the number two position in sales to end-users, while Xiaomi moved back to number three. Samsung maintained its overall lead, though its market share declined 1.9% year-over-year. Chinese smartphone vendors Xiaomi, Vivo, and OPPO increased their market share. Vivo was the fastest growing brand with sales up 20.9% in Q3 2021, likely the result of Vivo's 13 new smartphones and a bigger focus on Europe and the Middle East.  Of course, the smartphone industry isn't alone in facing a component shortage, which has also affected everything from the gaming industry to the auto industry.