It isn’t surprising that the coronavirus pandemic is having a big effect on global demand for many products. We are starting to see what the extent of this effect is. February saw the biggest drop in smartphone shipments in the history of the industry.
Strategic Analytics has announced that smartphones sales for February fell to 61.8 million units, down from 99.2 million units in the same period last year. This is a 38 percent drop and by far the biggest collapse since this market emerged in the 2000’s.
Demand collapsed in Asia (the world’s biggest smartphone market), as people were either unwilling to go to stores or unable to due to various measures of quarantine and social distancing. Several companies also had to halt production in many of its manufacturing plants. This was due to the same governmental decrees, and in some cases even as a result of some of the workers contracting COVID-19.
This big depression in the industry is being felt across all price categories and all segments of the market. Premium models did see a slightly larger drop compared to others, though.
We’re not expecting this month to look any better. While manufacturing has mostly been continued (especially in Chine, where most of the manufacturing takes place), the number of devices being built is being carefully controlled. While demand is low, there is no use in pumping out a massive amount of smartphones that will just sit on shelves. These devices will then eventually need to be sold at massively discounted rates.
Now that the epicentre of the outbreak has reached North America and Europe, don’t expect any big smartphone announcements to happen any time soon. In all likelihood most of the major premium phones will be pushed out until there is sufficient demand to warrant their production in mass.