Things are about to get even uglier for the excessive-finish smartphone market

Things are about to get even uglier for the excessive-finish smartphone market

As it occurs, Samsung issued a warning about its upcoming quarterly earnings actually hours earlier than Walmart’s determination to low cost the iPhone 5c to $29, apparently completely. Oddly sufficient, smartphone chip titan Qualcomm’s share worth has began lagging NASDAQ since early June whilst general tech funding sentiment stays giddy. Isolated occasions? Or omens of excessive-finish gadget gross sales slowing down? Unfortunately, it’s in all probability the latter.

We’ve recognized for months that market progress for each excessive-finish smartphones and tablets has began coming down quicker in 2014 than anybody anticipated. In India, pill income progress has slowed down dramatically, dropping to only 32% within the yr ending March 2014. Rumblings about China’s weakening smartphone market have rolled round for months. Way again in February, Gartner famous slowing smartphone progress globally and softening developments in China particularly.

Several developments are conspiring to undermine excessive-finish smartphone and pill demand: The growing reputation of H-inch to six-inch phablets is sucking the life out of correct pill market, whereas a flood of low cost, sub-$200 smartphones is robbing demand from luxurious smartphones which have shows of beneath H inches.

Vendors have been fairly conscious of those tendencies for a very long time, however unwilling to completely acknowledge their potential impression in gross sales projections. This summer time could be the turning level as orders for the pivotal again-to-faculty season are locked in. If retailers aren’t ordering the anticipated volumes of pricier smartphones outdoors of the phablet area of interest, we might see a reasonably dismal second-quarter earnings season in July.

As telephone distributors and chip corporations begin issuing autumn quarter outlooks within the coming weeks after the large tech inventory good points of the early summer time, we could possibly be in for a little bit of turbulence. NASDAQ’s surge over the previous two months in all probability gained’t maintain up very nicely within the face of main hardware sector disappointments.

More from BGR: H nice free Android apps that do superb issues the iPhone can’t (June 2014)

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