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Supply Chain Constraints End the Dream Run of the Global Smartphone Industry

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The supply chain and component shortage issues have ended the dream run of the global smartphone market, which had seen double-digit growth in the early quarters of 2021, a new IDC report showed on Friday.

Worldwide shipments declined 6.7 percent (year-over-year) in the third quarter this year, and smartphone vendors shipped a total of 331.2 million units during the quarter.

The supply chain issues have now compounded, and shortages are affecting all vendors alike.

“On top of component shortages, the industry has also been hit with other manufacturing and logistical challenges. Stricter testing and quarantining policies are delaying transportation and power supply constraints in China are restricting manufacturing of key components,” said Nabila Popal, research director with IDC’s Mobility and Consumer Device Trackers.

Despite all efforts to mitigate the impact, all major vendors’ production targets for the fourth quarter have been adjusted downwards.

“With continued strong demand, we don’t anticipate the supply-side issues to ease until well into next year,” Popal said in a statement.

While almost all regions saw a decline in shipments during 3Q21, the severity of the impact varied between regions.

Central and Eastern Europe (CEE) and Asia/Pacific (excluding Japan and China) (APeJC) suffered the largest declines of -23.2 percent and -11.6 percent (year-over-year).

Samsung finished the quarter in the top position with 69 million units shipped and a 20.8 percent market share.

Apple regained the second position with 50.4 million units shipped for a 15.2 percent market share and an incredible 20.8 percent year-over-year growth.

Xiaomi registered a 4.6 percent decline in the third quarter after high double-digit growth over the previous four quarters, as it also struggled with supply issues that it hadn’t faced in earlier quarters.

Xiaomi still captured the third position with a 13.4 percent share and shipments of 44.3 million units.


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