Gartner Says Samsung and Apple Sales Up Despite Smartphone Slowdown Danger

Samsun galaxy s3 phone
Samsun galaxy s3 phone

First-quarter cellphone sales may have been good for Samsung and Apple Inc. (NASDAQ: AAPL), but the numbers were brutal for their smaller competitors. As a matter of fact, most of the industry has reason to panic, as Gartner announced that global unit sales barely moved up in the first quarter.

The research firm reported on worldwide mobile phone sales:

Worldwide mobile phone sales to end users totaled nearly 426 million units in the first quarter of 2013, a slight increase of 0.7 percent from the same period last year. Worldwide smartphone sales totaled 210 million units in the first quarter of 2013, up 42.9 percent from the first quarter of 2012. The Asia/Pacific region was the only region to show growth in mobile phone sales this quarter, with a 6.4 percent increase year-on-year.

China may not be much to hang on to because its economy has started to slow. Under those circumstances, cellphone sales actually might fall in the second quarter and for the balance of the year. That would reverse a years-long trend and probably doom some of the industry's laggards.

It is good to be in the smartphone business and have little or no exposure to the bottom of the market where products are cheap for consumers and features are few. Apple's market share rose to 9% from 7.8% in the first quarter of last year, as it sold 38.3 million units in the most recent quarter. Samsung's numbers may look better, but they are driven to some extent by sales at the bottom of the market. The South Korean company's total sales for the quarter were 100.7 million, but smartphone sales were 64.7 million of that.

The research demonstrates the manufacturers other than Apple and Samsung may not survive long term. Sales of LG Electronic cellphones rose very modestly to 15.6 million, less than half of Apple's. ZTE sales were only 14.6 million. And Sony Mobile is already doomed, as it posted first-quarter sales of 8 million units.

The Gartner data shows, once again, that the smartphone battle already has been won by Apple and Samsung, and it is a wonder other companies continue to attempt to stay in.

Filed under: 24/7 Wall St. Wire, Telecom & Wireless Tagged: AAPL, featured