Analyst says Apple's global market share could drop below 10% in Q3 without a new iPhone

Analyst says Apple's global market share could drop below 10% in Q3 without a new iPhone
Of course Apple will definitely be announcing a new iPhone by Q3, but the timing of the actual release could mean that its global market share will take a substantial hit. There is a solid chance that we will see the announcement for the iPhone 5S in September, but it may not be released until October. And, according to Toni Sacconaghi of Sanford Bernstein, that could lead to Apple's global market share dropping below 10% in Q3. 

The basic premise behind Toni's prediction is sound: while Apple's smartphone sales did grow almost 7% year-on-year, the overall smartphone market grew 36%, so Apple's global market share has dropped year-on-year from 23% to 17%. Given the speed at which the smartphone market is growing, combined with Apple's usual sales lull that comes before a new hardware launch, Apple's market share will shrink. 

Mr. Sacconaghi drops the hammer by saying, "Perhaps most startlingly if Apple does not introduce a new iPhone or lower-priced phone in CQ3 [Apple's fiscal Q4], it is quite possible that iPhone's smartphone market share could drop into the single digits." There is a solid chance of that. 

But, it always needs to be mentioned that market share doesn't necessarily correlate to profits. As we've seen for a couple years now, even with a minority market share worldwide, Apple has consistently been on top or right up there with Samsung as far as profits. And, we also know that even though Apple's sales drop just before a new product launch, its profit margins grow because of supply chain improvements and reduced hardware costs. So, even if Apple's global market share does drop below 10%, we still have to wait and see what kind of trouble that causes for Apple's business.

source: CNN Money

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24 Comments

1. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Even though the new iPhone is launched, the global market share will drop as well.

5. raunak

Posts: 507; Member since: Oct 12, 2011

How can you know that? Just out of sheer ignorance and hate? Every time Apple launches a new smartphone, it gains market share, then it remains constant for a quarter or two and then goes down again until the new phone comes out. When Apple launches a mid range smartphone, Android's going to take a hit because mid range Androids lag as hell whereas the mid range iPhone will run smoothly even if it has 4s's specs.

7. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Yes, they will launch a "new" smartphone, but the word "new" is impossible for Apple right now, they keep doing the same thing, the design of their products and their iOS is boring. And yes, the iPhone never lag like Android smartphones, and it's easy to use, but there's nothing new on the iPhone and iOS. We want something new, a new INNOVATION, Apple needs to change, this is not 2007 any more!

19. anywherehome

Posts: 971; Member since: Dec 13, 2011

No, this is not 1990 any more = just an iConboard where you even can not open any object in any app (default app) = dumb phone

6. dan86

Posts: 298; Member since: Mar 17, 2012

Market Share and profit will go down if Apple don't come up with something NEW and yes that means something NEW! Not just an S with the existing number 5.

8. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

I agree! We want something NEW, not just an S with the existing number 5!

20. anywherehome

Posts: 971; Member since: Dec 13, 2011

Don't expect any real innovation like Google glass from outdated apple :-)

21. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Actually, the only INNOVATION from Apple is the iWatch. xD

13. darkkjedii

Posts: 31539; Member since: Feb 05, 2011

You said that for attention xperia. That's never happened, did get ya lotsa green thumbs though. +1 for achieving your mission lol.

14. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Huh? I'm saying that because this may be real. Yes, it won't happen right now but it will happen in the future, if Apple keep doing the same thing. :) For attention? I don't get it! This is not Youtube bro! :(

17. darkkjedii

Posts: 31539; Member since: Feb 05, 2011

Why are you so adamant that there's no changes coming at apple?

18. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

I believe that Apple will have something new in the FUTURE, but that's not a good idea. Dark, just think about it, if Apple make something new in the future, Apple will lose the competition, and they will fall slowly into the sinkhole. The only good idea is Apple needs to make something new ASAP, I hope they will make it in time, before 2015!

22. darkkjedii

Posts: 31539; Member since: Feb 05, 2011

Ok I see your point and I agree, but what do you think that something needs to be?

2. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

RIM saw their market share crater when they passed on the 2012 holiday season sales. Apple is not RIM/BB, but....

3. TheBitterTruth unregistered

Now this is innovation!

4. Topcat488

Posts: 1417; Member since: Sep 29, 2012

Apple, even until now, has only put out 1 iphone a year... And they can't seem to manage that!!! What in Hell are they doing all day, at Apple... My goodness, Google employees take naps, and play games at work... And are still able to help out Apple with Maps and Google Now. SMH

9. krimHD

Posts: 106; Member since: May 23, 2012

Great New...a nice way to start the day :D

10. roscuthiii

Posts: 2383; Member since: Jul 18, 2010

Apple does always reap in the profits with a minority market share... the problem however is that there is less profitability wiggle room. If even a few people leave the ecosystem it equates to a much larger loss than if the same number converted away from a company like Samsung, as an example. Analogy: (numbers used are purely for demonstrative purposes for those sticklers out there) Apple: 10 people each give 100 dollars > 1000 dollars Company X: 100 people each give 10 dollars > 1000 dollars If Apple loses 1 of those 10, they only take in 900 dollars. 2 people and they are down to 800 dollars. 3... 700 dollars. If company X, that has the much larger market share, loses people, it will take a whole lot more to equate the same kind of profitability loss. Basically, even though Apple rakes in the money with fewer people, it also means they can't afford to lose any.

15. palmguy

Posts: 986; Member since: Mar 22, 2011

Very good explanation.

11. Peter27

Posts: 233; Member since: Jul 13, 2012

nice picture Michael. I like.

12. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Yeah. Next time around, maybe a pic of an apple being eaten by a Samsung logo could be used?

16. StreetNerd

Posts: 870; Member since: Dec 08, 2010

their 'new innovation' is adopting the WP styled UI :') good game well played!

23. McLTE

Posts: 922; Member since: Oct 18, 2011

PA.. can we just please please stop receiving ANYTHING considered a prediction by an "analyst"??

24. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Why? The article got 23 posts before this one. 23 is a reasonable number. It is all about eyeball metrics. There were at least 46 eyeballs that saw this article. Probably more that saw the article but didn't post.

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