iPhone maker Apple’s (AKeynoteUSAL) share of the smartphone market continued to decline in the second quarter of 2024 (compared to a year ago), even as shipments increased, preliminary data from IDC (International Data Corporation) showed. Meanwhile, rival Samsung (OTC:SSNLF) remained the top player, but also lost market share compared to the second quarter of 2023. Chinese players are making great strides in smartphone market penetration, led by Xiaomi and Vivo, IDC noted.
In the second quarter, global smartphone shipments increased 6.5% year-on-year to 285.4 million. Deep discounts and the integration of generative AI (artificial intelligence) in smartphones are helping to boost overall smartphone demand worldwide.
Apple’s iPhones are losing steam
According to data from IDC’s Worldwide Tracker team, Apple shipped 45.2 million iPhones in the second quarter, up 1.5% compared to the second quarter of fiscal year 2023. That said, its market share fell to 15.8% from 16.6% during the same period. While the second quarter numbers show an improvement over the first quarter shipments, Apple is facing stiff competition from local Chinese manufacturers. Moreover, the ban on the use of foreign devices by Chinese officials could be one of the reasons for the decline in iPhone sales.
It is noteworthy that iPhone sales contribute the majority of Apple’s total revenue.
Interestingly, Apple still holds the second spot in terms of global shipments of high-end and premium smartphones. For reference, Apple lost the top spot to Samsung in the first quarter of fiscal 2024, when its shipments plummeted 9.6% year-over-year to 50.1 million units. On the bright side, IDC data on PC (personal computer) shipments showed that Apple’s PC shipments increased 20.8% year-over-year in the second quarter.
For its part, Samsung sold 53.9 million smartphones in the quarter, up 0.7% from the second quarter of fiscal year 2023. Meanwhile, its market share declined from 20% to 18.9% during the same period.
Chinese phone makers take over
IDC noted that Chinese companies are gaining market share by focusing on mid- and low-end smartphones, taking advantage of the current consumer spending dynamics. In fact, both Xiaomi and Vivo recorded double-digit growth in Q2 shipments. Xiaomi shipped 42.3 million (not far behind Apple) and Vivo sold 25.9 million smartphones in the quarter. Additionally, Oppo shipped 25.8 million smartphones in Q2. The market shares of Xiaomi, Vivo, and Oppo increased to 14.8%, 9.1%, and 9.0%, respectively.
IDC expects further momentum for generative AI-based smartphones in the second half of the year. It remains to be seen whether Apple can reignite demand momentum and regain its top spot in the global smartphone market or whether its iPhones continue to lose steam.
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