Apple's iPhone Records Flat Sales In Q3

Adding to Apple’s worries, new research shows that iPhone sales were flat during the third quarter of the year. That’s according a new report from Gartner, which put iPhones sales growth at about .7% during the period.

“Apple’s iPhones are facing a saturated premium smartphone market, with slowing growth rates and increased competition in China,” Anshul Gupta, research director at Gartner, notes in the report.

That said, Gupta suggested that Apple could still finish the year strong.

“Apple’s new flagship smartphones, announced in September, will be key to defining Apple’s overall iPhone unit sales in 2018,” Gupta said. “Initial channel checks suggest the Xs Max is outselling the Xs model, and we also see the Xs Max as a critical addition for the Chinese market, where Apple has been losing share.”

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In place of Apple, Chinese brands like Huawei and Xiaomi were mainly responsible for driving global smartphone sales during the third quarter of the year.

Overall, consumer smartphone sales grew 1.4% during the period, which came out to roughly 389 million units.

“If we had taken both Huawei and Xiaomi out of the global smartphone vendors list, smartphone sales to end users would have declined by 5.2%,” according to Gupta.

Particularly in emerging markets, Gupta attributed the success of Huawei and Xiaomi to quality camera features and higher-quality resolution displays at lower price points.

As a result, Huawei saw demand for its smartphones grow by 43% during the third quarter.

Samsung saw its biggest decline -- 14% -- since Gartner began been tracking smartphone sales, globally.

Samsung’s Galaxy S9, S9+ and Note 9 struggled to revive demand throughout the year, while its remodeled mid-tier and entry-tier smartphones faced a tsunami of competition from Huawei and Xiaomi.

Rather than a race to the bottom, however, phone makers are increasingly looking to new technologies like 5G and foldabe form factors to wow consumers, Gartner suggests.

Among other vendors, Samsung, Huawei and LG are all eying foldable phones in 2019.

In a recent note to investors, Guggenheim analyst Robert Cihra recently projected that iPhone sales were set to decline by 5% from Apple’s fiscal year 2018 to fiscal year 2019.

Both Goldman and UBS also suggested that Apple would likely sell fewer iPhones than previously expected.

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