Sales of Apple Inc’s (NASDAQ:AAPL) iPhone have managed to remain largely flat even as demand for smartphones buckled under coronavirus pandemic on a worldwide basis, according to Gartner.
What Happened: The COVID-19 pandemic led to a steep 20.4% decline in global smartphone sales in the second quarter of 2020, Gartner said in a report published Tuesday.
Amongst the top five smartphone makers, Apple’s sales remained level year-over-year, registering a decline of a mere 0.4%. On a quarter-over-quarter basis, sales grew 27.4%, Gartner said.
“The improved business environment in China helped Apple achieve growth in the country," said Annette Zimmermann, research vice president at Gartner. "In addition, the introduction of the new iPhone SE encouraged users of older phones upgrade their smartphones.”
Samsung Electronics Co., Ltd (OTC:SSNLF) recorded the sharpest decline among all the vendors with sales falling 27.1% year-over-year. Xiaomi Corporation (XIACF) smartphone sales fell 21.5%.
China, even with a reemergence of demand, saw sales fall by 7% year-over-year in Q2 2020, while India, which went through a strict lockdown, had the worst sales decline at 46%, Gartner noted.
Why It Matters: Wedbush analyst Daniel Ives said that even with the prevailing weak macroeconomic conditions and the effects of the pandemic on consumer demand, Apple has “once in a decade” opportunity with its upcoming 5G-enabled iPhone, as 350 million of its 950 million of the company's smartphones are in a window of an upgrade opportunity.
The analyst cites strength from China in the next six to nine months, services business of the Cupertino-based tech giant, and release of 5G models as key to growth.
Price Action: Apple shares closed nearly 0.8% lower at $499.30 on Tuesday.