14 Sep 2020
Dubai – The number of mobile phones shipped to the countries of the Gulf Cooperation Council (GCC) declined 10.3% quarter on quarter (QoQ) in Q2 2020 to total 4.9 million units, according to new research from International Data Corporation. The firm's latest Global Quarterly Mobile Phone Tracker shows that smartphone shipments were down 6.8% QoQ to 4.2 million units, while the feature phone market plummeted 25.3% to 0.8 million units. The value of smartphone shipments was down 16.8% QoQ to $1.3 billion, while the feature phone market's value plunged 24.0% to $15.4 million.
“While supply shortages impacted the market's performance in Q1 2020 and the early weeks of Q2 2020, a steep decline in consumer demand was the primary cause of the market's decline," says Akash Balachandran, a senior research analyst at IDC. "COVID-related lockdowns and measures resulted in physical retail closures for extended periods of time across the region, precipitating a major decline in demand."
Saudi Arabia accounted for 53.8% of all smartphone units shipped within the GCC in Q2 2020. "While there was a significant decline in demand across retail channels due to varying states of lockdown being implemented in Saudi Arabia, shipments into the country were less affected," says Balachandran. "Indeed, the planned implementation of a VAT increase in Saudi Arabia from July 1st caused channels to import larger quantities of smartphones before the change took place."
Samsung continued to lead the GCC smartphone market in Q2 2020, with 39.5% unit share and 25.9% value share. Samsung was able to retain value and extend its unit share due to the fact that it was relatively less impacted by supply shortages than other brands and cushioned by a shorter refresh cycle (particularly in the low to mid-range price bands). Apple saw reduced demand and shipments as consumers and the channel alike took a cautious approach to purchasing expensive high-end devices. Despite this, Apple accounted for 18.5% unit share of the GCC smartphone market in Q2 2020 and a 50.8% majority share of its value. Xiaomi continued to post unit and value growth following the introduction of its new line of Note models in the previous quarter, accounting for 9.9% unit share and 5.7% value share.
Looking ahead, IDC expects the GCC smartphone market to decline a further 1.0% QoQ in Q3 2020. "Across the GCC region, the potential for a second wave of COVID-19 cases, the return of lockdowns, stagnating oil prices and economies, and weakened consumer and commercial spending will push any real recovery toward the end of the year," says Ramazan Yavuz, a senior research manager at IDC. "While pent-up demand from consumers caused an immediate surge in smartphone sales after lockdowns were relaxed, the second half of the year is expected to perform slightly weaker as the region's economies are not showing signs of recovery and consumer demand is weakening after the initial pent-up demand is met."
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For the Middle East, Turkey, and Africa region, IDC retains a coordinated network of offices in Riyadh, Nairobi, Lagos, Johannesburg, Cairo, and Istanbul, with a regional center in Dubai. Our coverage couples local insight with an international perspective to provide a comprehensive understanding of markets in these dynamic regions. Our market intelligence services are unparalleled in depth, consistency, scope, and accuracy. IDC Middle East, Africa, and Turkey currently fields over 130 analysts, consultants, and conference associates across the region. To learn more about IDC MEA, please visit www.idc.com/mea. You can follow IDC MEA on Twitter at @IDCMEA.
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