How Apple is gaining smartphone customers during a chip shortage

[October 29, 2021]  By Aniruddha Ghosh and Subrat Patnaik

(Reuters) - Apple Inc is eating into its rivals' smartphone market share as the iPhone maker navigates through a global chip crunch better than other mobile phone makers, according to data providers.

Higher iPhone shipments helped Apple gain at least 3% market share in global smartphones in the third quarter, even as overall shipments shrunk by about 6% due to the chip shortage, according to data from market research firms Counterpoint, IDC and Canalys.

Given how closely tech companies guard smartphone sales data, the shipment figures are the best indication of who customers prefer.

"We are expecting another massive quarter for Apple and our expectation is they'll take a similar 20% shipment share in calendar year Q4," Counterpoint analyst Tarun Pathak said.

Apple has weathered the supply crunch better than many other companies due to its massive purchasing power and long-term supply agreements with chip vendors even though iPhone 13 production hit a snag due to factory closures in Asia and high demand in the second half of the year.

"Shortages are worst at the low-end, so Apple is less exposed than many of its competitors because it skews heavily toward premium," Ben Stanton, analyst at Canalys, told Reuters.

The shipments of pricier phones drove revenue to a record $100 billion in the third quarter, according to Counterpoint.

The Cupertino, California-based company's supply prowess was displayed in China https://www.reuters.com/
technology/huawei-spin-off-brand-honor-enters-top-three-china-shipment-ranking-research-2021-10-28 where it posted a staggering 83% annual sales growth last quarter, remaining one of top choices for big spenders in the world's second-largest economy.

Apple increased shipments in the third quarter, while market leader Samsung Electronics and rival Xiaomi Corp saw a drop as customers were lured by the price cuts to the iPhone 12 series and the faster processor and bigger camera in the latest iPhone 13 devices.

(Reporting by Aniruddha Ghosh and Subrat Patnaik in Bengaluru; Additional reporting by Tapanjana Rudra; Editing by Lisa Shumaker)

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