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Shipment Growth Reassures Handset Industry

Mon, 08/17/2009 - 5:19am

The recent 2Q09 earnings results of the world’s top five handset vendors by volume showed a quarter-on-quarter growth of 12.1% in shipment numbers, led by LG, Samsung and Nokia. With channel inventory reduced to more normal levels, prospects for continued quarterly growth in 2H09 have improved. However, challengers such as ZTE could displace Motorola or Sony Ericsson while they restructure. Meanwhile, Nokia is increasingly focusing on value.

By end-2Q09 it seemed that the handset industry’s channel-inventory problems had been largely resolved. Without the destocking experienced earlier this year, vendors are experiencing a better balance between sell-in and sell-through. This balance, combined with early signs of a possible recovery in demand and the impending launch of many advanced handsets, should see quarter-on-quarter growth in the remaining two quarters of 2009. However, Informa Telecoms & Media still expects total handset shipments for 2009 to be down 9.8% year-on-year, at 1.07 billion units.

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