Brief:

• Smartphone sales slipped 5.7% to 366 million units worldwide in the third quarter from a year earlier, consulting firm Gartner found. The sales performance for smartphones was better than for the broader market of mobile phones, which fell 8.7% to 401 million units during the period.
• Samsung kept its spot as the No. 1 maker of smartphones, selling about 80.8 million units in Q3. The South Korean company expanded its market share to 22% during the period from 20% a year earlier. Huawei maintained its No. 2 ranking with 51.8 million units, despite a 21% decline from a year earlier as the Chinese company coped with product bans in countries including the U.S. because of national security concerns.
• As pandemic uncertainties led many consumers to curtail nonessential spending, Apple saw a 0.6% dip to 40.6 million sales of iPhones in Q3 because of delayed shipments, though the technology giant's market share expanded slightly to about 11%.

Insight:

The decline in smartphone sales in Q3 suggests many consumers worldwide are still struggling with the economic fallout of the pandemic, but Gartner's estimate also shows signs of a strong recovery. The 5.7% decline isn't nearly as bad as the 20% plunge in Q1 and Q2 as the health crisis led to widespread lockdowns and disruptions to global supply chains. Delays in upgrades to 5G service also have dampened sales, with many consumers waiting for the higher-speed service to become more broadly available and show a measurable improvement over existing cellular networks.

"Consumers are limiting their discretionary spend even as some lockdown conditions have started to improve," Anshul Gupta, senior research director at Gartner, said in a statement. "Global smartphone sales experienced moderate growth from the second quarter of 2020 to the third quarter. This was due to pent-up demand from previous quarters."

The temporary shortage in components led companies like Apple to delay the launch of their latest phones until the fourth quarter. It's possible that pent-up demand and the introduction of its 5G iPhones will help Apple during the holiday shopping season that's typically the biggest period for smartphone sales. Last year, the company's sales expanded 7.8% to 69.6 million units in Q4, nearly overtaking Samsung's 70.4 million units, according to Gartner.

Samsung maintained its No. 1 spot with sales that have rebounded strongly this year. During the first half of 2020, when the pandemic was strongly felt in Asia, the company saw steep sales declines of more than 20%. Its 2.2% gain in Q3 from a year prior is a testament to the popularity of its newly launched Galaxy Note 20 series and stronger sales for its lower-price Galaxy A smartphones, ZDNet reported. The company may be able to maintain that momentum during the current quarter, though Apple's delayed iPhone launch may pressure Samsung's sales.