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Smartphone shipments continue growth over feature phones

Jack Loo | July 31, 2013
Samsung and Apple lead premium tier smartphone sector, but face pressure from mid-tier makers.

Smartphone shipments represented more than half of the world’s mobile phone shipments for the second quarter in a row, according to ABI Research.

Led by Samsung, an estimated 408 million handsets and 214 million smartphones were shipped during the second quarter of 2013, ABI Research analysts said. 

“Despite concerns of premium tier smartphone saturation, both Samsung and Apple were able to deliver better than expected results in the second quarter,” said ABI Research Senior Analyst Michael Morgan.

Smartphone shipments maintained a healthy growth rate of 5.5 percent sequentially and nearly 44 percent year-over-year. In comparison, feature phone shipments declined 20 percent year-over-year to 195 million units as low-cost manufacturers continue to claw their way up-market with increased device specifications.

Despite the surprising tenacity of premium smartphones, Apple’s market share (14.6 percent) dropped to its lowest point since the third quarter of 2011. ABI Research attributed this share loss to the Samsung Galaxy S4 launch and the continued growth of low cost and mass market smartphone shipments.

“The second half of 2013 will be defined by fierce competition between price-aggressive OEMs moving toward the middle tiers for increased margins while at the same time top- tier OEMs are diversifying portfolios into the middle in search of continued growth,” said ABI Research Senior Practice Director Jeff Orr. 

As competitors such as Huawei, ZTE and Lenovo move their smartphone portfolios upstream, ABI Research analysts said there will be increasing margin pressure on the premium smartphone segment where the majority of industry profits reside.

 

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