Q3 Smartphone Production Reaches Yearly High

By Paul Ausick Updated Jan 13, 2:12AM EST · Published Oct 19, 9:15AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Q3 Smartphone Production Reaches Yearly High — © Thinkstock

Global smartphone production volumes rose 10.4% sequentially in the third quarter to approximately 350 million units, according to research firm Trendforce. Chinese brands get the credit for the strong quarterly growth.

The market share leader, Samsung Electronics, posted quarterly share of 22.3%, down from 24.3% share in the second quarter. That is highly likely to tumble further now that the Korean maker has withdrawn its Galaxy Note 7 from the market following the exploding device fiasco.

Apple Inc. (NASDAQ: AAPL) ranked second in the third quarter with a market share of 12.9%, down from 15.0% in the second quarter. The company produced 45 million units in the third quarter, among which were only a modest number of the new iPhone 7 and 7 Plus. TrendForce said that much of the new phones’ production will occur in the fourth quarter.

[nativounit]

Analyst Avril Wu commented on the rise of Chinese device makers:

The combined production volume from Chinese brands reached 168 million units in the third quarter, translating to a sequential quarterly increase of 18%. As in the previous quarter, the combined production volume of Chinese brands exceeded the combined production volume of leading brands Apple and Samsung. The role of Chinese brands as the main driving force of global smartphone shipments is therefore firmly established.

Huawei was the third-quarter market share leader among Chinese makers with 9.1%, down from 9.2% in the prior quarter. Oppo, however, posted the most growth, rising from 5.6% of the second-quarter market to 6.1% in the third quarter. LG Electronics added 0.3 point to lift its third-quarter share to 5.7%, and BBK/vivo rose from seventh place in the second-quarter ranking to sixth in the third quarter with a 5.2% share, up from 4.7% in the prior quarter.

Wu had more to say about Oppo and Vivo:

OPPO and Vivo mainly focus on their domestic market and are especially good at developing sales channels in the more remote urban communities within the country. They have already established themselves in China’s third- and fourth-tier cities and are expanding into fifth- and sixth-tier cities in the second half of 2016. OPPO and Vivo will maintain strong growth this year as their strategies have paid off.

Of the nearly 350 million units produced by all smartphone makers in the third quarter, nearly half (167,528) were produced by China-based brands. In addition to Huawei, rounding out the top five makers with nearly 62% of all Chinese production were Oppo, Vivo, Lenovo and Xiaomi.

See the TrendForce press release for more details.

[wallst_email_signup]

About the Author Paul Ausick →

Paul Ausick has been writing for a673b.bigscoots-temp.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.

He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.