Embargo date: 0600hrs (CEST) on August 17, 2015
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1 Press release Embargo date: 0600hrs (CEST) on August 17, 2015 Date August 17, 2015 Press contact Wes Rogers communications.com 4G smartphones unit share more than doubles in a year, capturing 58 percent in Q In Q global smartphone sales value was up +7 percent year-on-year, and unit sales were up +5 percent year-on-year. 4G unit share was 58 percent globally in Q2 2015, up from 26 percent in Q This represents a unit growth of +129 percent year-on-year, with China leading the global 4G ramp up. Globally the unit share of smartphones with large screens (5 +) increased to 48 percent in Q2 2015, up 5 percent from Q1 2015, and 17 percent from Q China has the highest regional share of smartphones with large screens at 63 percent, followed by Developed APAC at 61 percent. Average sales price (ASP) in USD declined -1 percent from Q1 to Q2 2015, but it was up +3 percent on a year-on-year basis. GfK forecasts smartphone ASP to decline by -1 percent year-on-year in Nuremberg, Aug 17, 2015 Almost six in ten (58 percent) smartphones sold in Q were 4G-enabled, according to the latest global smartphone sales data from GfK. And with a major operator launching 4G services in India at the start of this month, 4G is now available in all key countries. GfK forecasts 4G smartphone penetration to continue to grow at the expense of 3G, which is currently at 38 percent of smartphone units and is forecast to decline by another percentage point by Q GfK SE Nordwestring Nuremberg Germany Tel Fax public.relations@gfk.com Management Board: Matthias Hartmann (CEO) Christian Diedrich (CFO) Dr. Gerhard Hausruckinger Debra A. Pruent Chairman of the Supervisory Board: Dr. Arno Mahlert Commercial register Nuremberg HRB Kevin Walsh, director of trends and forecasting at GfK comments, India is expected to be the largest contributor of absolute smartphone unit growth globally this year. The main reason behind this is the currently low smartphone penetration in the market together with a significant intensification of the competition amongst the smartphone vendors, which will drive ASP erosion allowing more affordable devices in the market. There are significant regional differences in 4G take up: price polarization in N. America, saturation in W. European markets, local brands tackling global players in India and China, and intense price competition in emerging markets. Walsh continues: The first half of the year has seen macro events providing headwinds to topline demand in regions like C&E. Europe, 1
2 LATAM and China. However, the underlying trend of consumers optimizing their digital consumption by screen size, within affordability constraints, continues in all regions. This trend can be seen from TV s down to smartphones. In smartphones, it manifests in trends like price point polarization in the US, the rapid screen-size increases in emerging markets and phablet market development. These trends are forecast to continue to the end of year but we see new inflection points and market drivers for Here s how the global smartphone market stands today: N. America percent year-on-year growth in unit sales in Q In this market, which like W. Europe is nearing saturation point, we see a price polarization as sales of high ($500+) and low end ($0-250) devices grew at the expense of mid-ranged devices ($ ). Smartphones in the high end captured 43 percent of smartphone unit share in Q2 2015, up from 38 percent in 2Q N. America and China were the only regions to see an increase in high-end smartphone unit share on a year-on-year basis. W Europe - units up +9 percent year-on-year, but value and ASP fall Unit sales of smartphones grew +9 percent year-on-year in Q2 2015, but 2
3 sales value declined, due to a mix shift towards the low-end observed in the quarter capturing almost 50 percent of the smartphone unit mix, up from 37 percent in Q This region had very high LTE penetration levels in smartphones in Q2 2015, with the Nordics taking the top three places: Norway at 90 percent, Denmark at 89 percent and Sweden at 88 percent. China - high-end demand increased +49% year-on-year in Q Unit sales fell -10 percent year-on-year in China to Q2 2015, which follows the previous quarter s decline of -14 percent year-on-year. However, strong demand for high-end smartphones ($500+) pushed smartphone value up +17 percent year-on-year to $26.8bn in the quarter. The high-end smartphone market now accounts for 17 percent of the market, up from 10 percent in Q and is growing at the expense of the low-end. In 2015, GfK forecasts high-end unit demand in China to grow +28 percent year-on-year, the strongest growth in this price band of any region this year. C&E. Europe - a tale of two halves: rise and fall Despite unit sale declines of -11 percent year-on-year in Russia and -34 percent year-on-year in Ukraine driven by macroeconomic factors, the total regional smartphone demand grew +3 percent year-on-year in Q2 2015, buoyed by strong growth in Poland and Romania. GfK forecasts smartphone unit demand in Russia to decline to -14 percent year-on-year, and -23 percent year-on-year in Ukraine in
4 Latin America Brazilian economic slowdown starts a change of pace A significant slowing of growth in this region has been caused mainly by the macroeconomic situation in Brazil. Q saw +1 percent year-on-year unit growth, compared to +28 percent in Q and +72 percent rise in Q In 2015, GfK forecasts total smartphone unit demand and sales value to drop in Brazil for the first time ever, with unit sales expected to fall - 3 percent year-on-year, and sales value to decline -15 percent year-onyear. Emerging APAC - fierce competition in a growing Indian market In Emerging APAC, smartphone unit demand increased by +22 percent year-on-year in Q2 2015, with all major countries growing. India in particular has seen strong unit growth of +40 percent year-on-year, with local brands accounting for three of the top five smartphone vendor spots in the quarter. A number of Chinese smartphone brands have entered the Indian market this year, intensifying the already fierce competition between international and local vendors. The resulting price war is forcing ASPs down in a market where more than 80 percent of sales are in the low-end. In Q2 2015, smartphone ASP in India declined -12 percent year-on-year. In 2015, GfK forecasts smartphone prices in India to fall -11 percent year-on- 4
5 year and 4G unit demand to more-than-triple, capturing 6 percent of the smartphone unit demand. Developed APAC unit sales up +6 percent as Japan improves Unit sales in Developed APAC grew +6 percent year-on-year in Q2 2015, driven by Japan (+15 percent), which benefitted from an easy comparison with low sales in Q GfK forecasts smartphone unit demand in the region to grow by +1 percent year-on-year in A -6 percent smartphone demand decline in S. Korea will be offset by Japan, which is forecast to see a +3 percent year-on-year increase. Walsh concludes: Weak macroeconomic trends will continue across a number of major countries such as Brazil, Russia and China, but recoveries when they come are often faster than expected especially for tech sectors. In addition, we are still a long way from saturation in emerging market while adjacent industries to the smartphone fuel the next round of growth generally complementing and in some cases cannibalizing smartphone growth. -ENDS- Note to editors GfK forecasts End Demand consumer purchases rather than manufacturer shipments. Market sizes are built up by point-of-sale (POS) tracking in 90+ markets with updates on a weekly and monthly basis. For the US, GfK employs proprietary market modeling and consumer research rather than POS to produce its market forecasts. Values are based on unsubsidized retail pricing. Data is available quarterly. The next data set will be available in late October GfK continually works to ensure its panel data is as accurate a reflection of the end market as possible. When a change is made to the number of participants in our panel, GfK will amend historical data to better reflect the impacted end market. For example, when a new retailer joins, the addition of their historic sales may lead to slight adjustments to actual data. List of countries in the regions used in this release: Developed APAC Australia Hong Kong Japan New Zealand Singapore South Korea Taiwan Emerging APAC India Indonesia Kampuchea (Cambodia) Malaysia Philippines Thailand Vietnam 5
6 About GfK GfK is the trusted source of relevant market and consumer information that enables its clients to make smarter decisions. More than 13,000 market research experts combine their passion with GfK s long-standing data science experience. This allows GfK to deliver vital global insights matched with local market intelligence from more than 100 countries. By using innovative technologies and data sciences, GfK turns big data into smart data, enabling its clients to improve their competitive edge and enrich consumers experiences and choices. For more information, please visit or follow GfK on Twitter: Responsible under press legislation: GfK SE, Global Communications Jan Saeger Nordwestring Nuremberg Germany press@gfk.com 6
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