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Apple remains top dog of declining tablet market

02 May 16

Tablet shipments are on the decline around the world as large-size smartphones continue to erode the market, according to global market research firm TrendForce.

The analysts say first quarter shipments for 2016 totaled 35.2 million units, translating to a 35% drop from the previous quarter and a 7.9% drop from a year ago.

Anita Wang, TrendForce notebook analyst, says branded tablet vendors’ shipment results were mediocre following their impressive fourth-quarter performances that were supported by the peak season demand, and the trend of tablets becoming even larger has become more apparent.

TrendForce’s data shows the 7.x-inch tablets accounted for less than 40% of the total tablet shipments in the first quarter. This is a significant contraction from a year earlier when this size segment still held 51% of the shipment share, the analysts say.

Conversely, tablets sized 11.x inches and above have increased their percentage in the total shipments to 10% in the first quarter from 1.5% a year ago. Apple’s iPad Pro and Microsoft’s Surface Pro 4 are the main contributors to the shipment growth of large-size tablets, TrendForce says.

Apple was still the leading brand by shipments in the first quarter with 10.3 million units shipped, amounting to a 36% quarterly decline and an 18.8% year-on-year decrease. Wang noted that the 9.7-inch iPad Pro was released this March, so the bulk of its shipments will fall into the second quarter and drive the growth of the overall iPad shipments against market headwinds.

The sales of the 12.9-inch iPad, on the other hand, have started to decelerate after two quarters since its release. Weakening sales of this product may constrain the growth of Apple’s tablet shipments in this second quarter, TrendForce says.

Samsung kept its position as the number two brand in the first-quarter shipment ranking. The vendor shipped 6.5 million units, down 30% from the prior quarter and down 26.5% year on year. The market only saw two new tablets from Samsung in the first quarter, one each in the 7-inch and the 12-inch size categories. The lack of fresh products, the erosion of the 7-inch tablet market by large smartphones and seasonality all resulted in sharp shipment decline for Samsung during this period, according TrendForce.

Amazon’s first-quarter tablet shipments stood at 2.2 million units, representing a huge 47% decline compared with the prior three-month period but also a skyrocketing year-on-year growth of 337%. The Fire tablet, which has seen strong sales since the fourth quarter, helped propel Amazon’s shipments in the off season and allowed the vendor to retain its third place ranking in the first quarter, the analysts say.

Lenovo’s first-quarter tablet shipments fell 26% compared with the previous quarter to 2.2 million units. The brand shared the same spot with Amazon in the ranking. Lenovo kept up its shipments and continued with promotional activities in various regions during the off season since its final fiscal quarter aligns with the January to March period.

Huawei shipped two million units in the first quarter, a 10% drop compared with the previous period. Nonetheless, it remained as the fifth-largest tablet brand after overtaking ASUS and Microsoft in the fourth-quarter ranking last year, TrendForce finds.

According to Wang, Huawei has been able to endure the downturn in the tablet market and maintained its role as a major vendor because of its vast retail network for mobile devices. The brand has also achieved strong shipments numbers by releasing a variety of tablet models in large volumes and increasing its promotional activities in the emerging markets, TrendForce says.

Microsoft held on to the sixth place in the first-quarter ranking owing to the brisk sales of Surface Pro 4. However, Microsoft will not be able to maintain its sales momentum this year if its next-generation Surface Pro 5 is released much later in the first quarter of 2017, TrendForce says. The analysts anticipate Microsoft to yield its ranking spot to ASUS and drop down to seventh place in the second quarter.

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