This week, business media headlines are citing market quantitative research firm IDC indicating that in Q1-2024, Samsung Electronics surpassed Apple as the designated leader in global smartphone shipments.

Reportedly, Apple’s iPhone shipments declined 9.6 percent in Q1-2024, to 50.1 million units. Industry rival Samsung’s smartphone shipments reportedly fell a mere 0.7 percent to 60.1 million units, according to IDC data. In the third position is China’s Xiaomi with reportedly 40.8 million shipments during the past quarter.

IDC indicated that Samsung’s market share fell to 20.8 percent in Q1, compared to 22.5 percent in the year earlier quarter. Apple’s smartphone market share fell to 17.3 percent in Q1 compared to 20.7 percent in the year ago period.

Competitive Headwinds in China

As business, industry and Supply Chain Matters have noted, Apple has faced considerably more competition in China from various domestic based competitors such as Xiaomi and others. The Chinese government has banned Apple devices for use in any governmental settings. With Apple now sourcing higher levels of iPhone model production in areas such as India, there appears to be Chinese consumer backlash as well.

Prospects for the Remainder of 2024

Bloomberg’s reporting of global smartphone shipments in the latest quarter, specifically cites Nabila Popal, research director at IDC who indicated the beginnings of a smartphone market resurgence this year: “The smartphone market is emerging from the turbulence of the last two years both stronger and changed.

Further noted to Bloomberg by Popal was the following: “While Apple has been super resilient and seen a lot of growth in shipments and share over the last few years, it will be a challenge for it to maintain the pace of growth and the peak share it saw in 2023. As the market recovers further in 2024, IDC expects Android to grow much faster than Apple.”

 

Added Thoughts

At Supply Chain Matters we have previously utilized the cliché- that the shine may be dulling on the fruit- in these cycles of troubling news related to Apple.

Apple is the darling of Wall Street having lavished investors with lucrative growth and monetary returns on investment. The company was crowned as the most valuable, consistently delivering healthy product margins and profitability, not only in hardware sales, but higher margin related services. By one estimate, there are upwards of 1.5 billion active iPhone users worldwide. That is a huge market to tap in turns of annualized services and recurring revenues.

In addition to challenges related to iPhone market share, the company decided to finally abandon its ten-year long Project Titan efforts to develop an Apple branded electric vehicle.  After billions of reported investment and various different project team leaders, there was little to show in any announced product or services.

Apple will continue to be a valuable company. But the notions of losing the crown for global market leadership by means of shipments has to be internally stinging.

It is a reminder for all companies that in today’s increasingly disruptive market and industry settings, leadership can be fleeting, even for a company with iconic branding and flair.

In product, in reputation and in global wide supply chain capability, market leadership is a constant challenge, even for the most creative, and highly profitable.

 

Bob Ferrari

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