Global smartphone shipments down 6% in Q3 2021: Report

Our Bureau Mumbai | Updated on October 18, 2021

“The chipset famine has truly arrived”: Decline was due to component shortages

Global smartphone shipments fell 6 per cent in Q3 2021, according to preliminary estimates by Canalys.

As per the report, the decline in global smartphone shipments was due to component shortages. Shipments fell as vendors struggled to meet demand for devices owing to component shortages.

Also see: Global chipset shortage is a result of several macroeconomic factors: CEO realme India

“The chipset famine has truly arrived. The smartphone industry is striving to maximize production of devices as best it can. On the supply side, chipset manufacturers are increasing prices to disincentivise over-ordering in an attempt to close the gap between demand and supply. But despite this, shortages will not ease until well into 2022. As a result of this, as well as high costs of global freight, smartphone brands have reluctantly pushed up device retail pricing,” said Ben Stanton, Principal Analyst, Canalys.

“At the local level, smartphone vendors are also having to implement last-minute changes in device specification and order quantities. It is critical for them to do this and maximise volume capacity but unfortunately it does lead to confusion and inefficiency when communicating with retail and distributor channels,” he added.

Impending sales holidays

As per Stanton, many channels are nervous heading into important sales holidays, such as Singles’ Day in China and Black Friday in the West.

“Channel inventories of smartphones are already running low, and as more customers start to anticipate these sales cycles, the impending wave of demand will be impossible to fulfil. Customers should expect smartphone discounting this year to be less aggressive. But to avoid customer disappointment, smartphone brands which are constrained on margin should look to bundle other devices, such as wearables and IoT, to create good incentives for customers,” Stanton said.

As for the top vendors, Samsung topped the list holding a 23 per cent market share in Q3 2021, as per preliminary estimates. It was followed by Apple which regained the second spot with a 15 per cent share due to strong early demand for iPhone 13. Xiaomi stood third with a 14 per cent while Vivo and Oppo completed the top five with 10 per cent share each.

Published on October 18, 2021

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