Smartphone shipments across Europe experienced their largest drop ever in Q1, as the continent entered a new era in which increases in growth regions failed to offset declines in saturated markets.

New data from Canalys showed smartphone shipments across all of Europe fell 6.3 per cent year-on-year to 46 million units. While Central and Eastern Europe markets grew 12.3 per cent to 15.9 million units, Western Europe erased those gains, dropping 13.9 per cent to 30.1 million.

Analyst Ben Stanton noted in a statement the continent is “moving from a growth era to a cyclical era”. He added the shift “presents a brand new challenge to the incumbents, and we expect several smaller brands to leave the market in the coming years.”

Vendor results
Samsung remained the dominant vendor in the quarter despite shipments dropping 15 per cent year-on-year to 15.2 million units. Apple shipments dipped 5.4 per cent to 10 million units, leaving it in second place. The iPhone X accounted for around a quarter of iPhone models shipped, while older iPhone models, including the SE, 6 and 6S accounted for around another quarter.

Third-placed Huawei grew shipments nearly 39 per cent to 7.4 million units.

All told, Samsung, Apple and Huawei grew their combined market share to 71.4 per cent in Q1 2018, up from 61 per cent in the year-ago period.

Canalys research analyst Lucio Chen noted Xiaomi and Nokia-branded models from HMD Global quickly rose to fourth and fifth place respectively despite the vendors being relatively new entrants to Europe. Xiaomi’s shipments were up nearly 1,000 per cent year-on-year at 2.4 million: HMD Global shipped 1.6 million Nokia units in its initial Q1.

Chen noted both vendors are privately owned, meaning they have an incentive to operate at a “substantial net loss” while building market share. However, he added the approach “is not sustainable in the long term” and said both companies will eventually have to follow the three market leaders by shifting their cost structures “towards profitability”.

Smaller brands including Alcatel, Sony and LG, posted significant declines in the quarter, Canalys stated.