Samsung Clear Leader in Smartphones as It Rebounded From Note

Debacle, Analysts Say

Two market research companies tracked gains in the Q2 global smartphone market,
they reported Wednesday, while IDC reported a 1.3 percent decline over the year-ago
quarter. Canalys showed shipment gains of nearly 4 percent to 340 million and Strategy
Analytics reported a 6 percent bump to 360 million units, while IDC recorded 341.6 million
Q2 smartphone shipments vs. 346.1 million in the year-ago quarter. IDCs figures exclude
OEM sales.

Samsung maintained the top spot in shipment volume and market share across the
board, at about 79 million units among the three research firms. Shipments of the Samsung
Galaxy S8 have been strong in some regions, but there are signs that demand has been
overestimated, said Canalys analyst Tim Coulling. He cited an inventory buildup in Europe
and discounting in the U.S. indicating Samsung may be testing the limits of Android
smartphone pricing. Apple also must justify any significant price increases with tangible
improvements in features and design, said Coulling.

Samsungs 79.5 million Q2 shipments showed it continued to recover from last

years Galaxy Note 7 battery fiasco, said SAs Neil Mawston. Robust demand for the
Galaxy S8 led to a 2 percent increase in shipments, he said.

Consumers have responded well to the edge-to-edge display of the Galaxy S8 family
along with the 18:9 aspect ratio, said IDC, which expects numerous other vendors to bring
out similar designs heading into next year. Samsung holds 23.3 percent market share, also
due to strong performance in its A and J series handsets, IDC said.

No. 2 Apple, with 12 percent market share vs. 11.7 percent in Q2 2016, shipped 41
million phones in the quarter, said IDC. It credited strong demand for the iPhone 7 and 7
Plus, which combined for double-digit growth in the quarter, propping up average selling
prices by 2 percent year on year. All eyes will be on the iPhone 8 when its announced
next month, with expectations of a larger AMOLED display, wireless charging and improved
performance and reliability, IDC said.

Closing in fast on Apple is third-place Huawei, which had strong gains in Q2 to

reach 10.7 percent market share on 38.4 million shipments, according to SA. Strong sales in
greater China and many developed European markets drove Huawei gains, leading to a 2
percentage point gain in share, said IDC, crediting mid- and high-end phone sales for
improving market share. But Huawei will have to penetrate the U.S. market at the carrier
level to pass Apple or Samsung at the top, it said.

Oppo, ranked fourth in market share at 8 percent, had a 22.4 percent hike in shipment
volume during Q2 to 27.8 million, said IDC, on strength in Southeast Asia. Oppo added
service centers in India in the quarter, along with exclusive retail stores, while boosting
advertising and implementing a free phone offer in Thailand, IDC said. Oppos share
increase came at the expense of ZTE, LG and TCL-Alcatel in China, India and Europe, SA
said.

Xiaomi pushed back into the top five on a strong Q2, giving it roughly 6 percent share
of global smartphone volume, said the research firms. Its 21.2 million shipmentsa 59
percent year-over-year increasenudged vivo out of the top five, said IDC.

The biggest change in the quarter, said IDC analyst Ryan Reith, was the size of the
contraction in the other category, which shrank from 46 percent to 39 percent. Citing a
challenging environment for market share growth, Reith said smaller, more localized
vendors will continue to struggle, especially as the leading volume drivers build out their
portfolio into new markets and price segments. Rebecca Day