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India's Smartphone Market Got Cut in Half Last Quarter

By Evan Niu, CFA – Jul 18, 2020 at 11:00AM

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A variety of factors, many related to COVID-19, caused smartphone shipments to plunge by 48%.

If you thought that the record 12% drop in the global smartphone market in the first quarter was bad, the plunge in India's smartphone market in the second quarter makes that double-digit decline look manageable in comparison. India, the second-largest smartphone market in the world behind China, saw shipments plummet 48% in the second quarter, according to estimates released by Canalys last week.

The massive drop was caused by a confluence of factors, many of which were related to the ongoing COVID-19 pandemic.

Three women in traditional Indian dress using smartphones

Image source: Getty Images.

Shipments cut nearly in half

Both supply and demand were affected by the coronavirus outbreak. The government had imposed a drastic countrywide lockdown on its 1.3 billion citizens, the largest lockdown in the world. The restrictions were eased in May, but the Indian government has reinstated lockdowns now that COVID-19 cases have hit 1 million.

India has been trying to get smartphone companies to expand manufacturing operations within the country in recent years, leveraging import tariffs and local sourcing requirements to incentivize foreign multinationals. Canalys estimates that 96% of all smartphones sold in India in 2019 were assembled locally. Those efforts include deals with Apple (AAPL 0.90%) and its largest contract manufacturer, Foxconn. However, Apple is a tiny player in the Indian smartphone market.

Here are the top five vendors for the second quarter.


Q2 2020 Shipments

Q2 2020 Market Share

Growth (YOY)


5.3 million




3.7 million




2.9 million




2.2 million




1.7 million




1.4 million




17.3 million



Data source: Canalys. YOY = year over year.

Apple's shipments fell by "just 20%," which isn't nearly as bad as the bigger sellers. The Cupertino tech giant has long struggled to grow its presence in India, largely due to the high prices of iPhones and relatively lower levels of discretionary income for average Indian consumers. Apple sold approximately 250,000 iPhones in the second quarter, according to Canalys, representing a measly 1.4% market share.

In a statement, Canalys analyst Madhumita Chaudhary said:

It's been a rocky road to recovery for the smartphone market in India. While vendors witnessed a crest in sales as soon as markets opened, production facilities struggled with staffing shortages on top of new regulations around manufacturing, resulting in lower production output. The fluidity of the lockdown situation across India has had a deep-rooted effect on vendors' go-to-market strategies.

Making matters worse, India has been grappling with floods and rising geopolitical tensions with China. The border dispute with the Middle Kingdom is spurring anti-China sentiment, which should be bad news for Chinese smartphones. (Vivo, Oppo, and Realme are all subsidiary brands of China's BBK Electronics, and Xiaomi is one of China's most prominent brands.) However, Chinese brands are still the most affordable.

"Despite the sentiment, the effect on Xiaomi, Oppo, Vivo and Realme is likely to be minimal, as alternatives by Samsung, Nokia, or even Apple are hardly price-competitive," according to Canalys analyst Adwait Mardikar.

Evan Niu, CFA owns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has a disclosure policy.

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