COVID-19 pandemic has wreaked havoc on global smartphone market with shipments falling 13 per cent to 272 million units in March 2020 quarter, according to research firm Canalys.
A report by Counterpoint Research also indicated a similar scenario stating that this is the first time since March 2014 quarter that the global smartphone shipments have fallen below 300 million units in a quarter.
Canalys, in its report, pointed that the smartphone market had entered 2020 in good health, having just recorded two consecutive quarters of growth, but demand for new devices has been "crushed".
Canalys Senior Analyst Ben Stanton said that in February, when the coronavirus was centered on China, vendors were mainly concerned about how to build enough smartphones to meet global demand.
"But in March, the situation flipped on its head. Smartphone manufacturing has now recovered, but as half the world entered lockdown, sales plummeted. Poor business results, employee redundancies and furloughs are causing a great deal of anxiety and uncertainty," he added.
Stanton noted that smartphones are still a necessity for most people, and device availability in online channels has enabled those who need to replace a broken or lost phone to do so.
But many customers who would have bought a new smartphone as a luxury have delayed that purchase, he said.
Canalys said Samsung led the global tally with 21.9 per cent market share in March quarter, followed by Huawei (18 per cent), Apple (13.6 per cent), Xiaomi (11.1 per cent) and vivo (8.9 per cent).
According to Counterpoint Research, the fall in first quarter was mainly driven by a 27 per cent year-on-year shipment decline in China, the initial epicentre of the pandemic.
The disruption in China also impacted the supply side of handsets and components for some OEMs (original equipment manufacturers), which in turn, affected global shipments.
In the long run, this could lead to OEMs diversifying their supply chain across regions, and this could be a silver lining for countries like India and Vietnam, it added.
"Consumers, under these uncertain times, are likely to withhold making many significant discretionary purchases. This means the replacement cycles are likely to become longer," Tarun Pathak, Associate Director at Counterpoint Research, said.
"Lockdowns in most parts of the world will be lifted in a staggered way, which will mean it could take time before the retail activity completely resumes," he noted.
He added that users staying at home, however, are engaging on their smartphone more than ever and this provides opportunities for services like mobile gaming and OTT services.
"This will likely lead to operators being able to upsell to larger data packages with higher ARPUs," he noted.
Counterpoint expects the entry-level segment to be hit the most, especially in emerging economies, driven by impact on people's income in the unorganised labour sector and higher offline purchase tendency.
"The mid segment will continue to drive volumes. The premium segment is least likely to be directly affected by the economic meltdown. As the consumers would adjust to the new normal, the sales in the segment are likely to rebound," it said.
According to Counterpoint's report, Samsung led the global tally with 20 per cent market share in March quarter. Huawei had 17 per cent share, followed by Apple (14 per cent), Xiaomi (10 per cent), Oppo (8 per cent) and vivo (7 per cent).
Lenovo Group, realme, LG and Tecno each cornered 2 per cent share in the March quarter, it added.
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