Global mobile phone sales increased 5.6% year-on-year in Q3 2011 to 440.5 million units, according to Gartner.
Demand in emerging markets for low-cost mobile phones from white-box manufacturers and dual SIM devices, drove a strong performance for non-smartphones.
Sales into the channel reached 460 million units; the increase was due to inventory build-up in the channel, partly because of the shipping of new devices late in the quarter but mostly to prepare the channel for the holiday season, according to Gartner.
The company expects most of the build-up to be sold by the first quarter of 2012.
"Our forecast for the end of the year remains broadly in line at a worldwide level as regions such as Asia/Pacific and the Middle East and Africa make up for weaker performance in the Western European market," said Annette Zimmermann, principal analyst at Gartner.
Smartphone sales accounted for 26% of all mobile phone sales, growing only marginally from 25% in the previous quarter. Sales of smartphones to end users reached 115 million units in Q3 2011, up 42% from Q3 2010. Sequentially, smartphone sales slowed to 7% growth from Q2 2011 to Q3 2011.
"Strong smartphone growth in China and Russia helped increase overall volumes in the quarter, but demand for smartphones stalled in advanced markets such as Western Europe and the US as many users waited for new flagship devices featuring new versions of the key operating systems," said Roberta Cozza, principal research analyst at Gartner. "Slowdowns also occurred in Latin America and the Middle East and Africa. Some consumers held off upgrading in the third quarter because they were waiting for promotions on other new high-end models that were launched in the run-up to the fourth quarter holiday season," Cozza said. "Other consumers were waiting for a rumoured new iPhone and associated price cuts on older iPhone models; this affected US sales particularly."
Nokia continues to be the worldwide leader in mobile device sales, despite a drop in market share, Nokia accounted for 23.9% of all device sales.
According to Gartner, the second quarter of 2011 was the low point for Nokia, and the third quarter brought signs of improvement. Dual-SIM phones in particular, and feature phones generally, maintained Nokia's momentum in emerging markets.
Nokia and Microsoft have been pushing the new Lumia devices, which should bring improvement in Q4 2011. However, according to Gartner, a true turnaround won't take place until the second half of 2012.
Samsung is now the No 1 smartphone manufacturer worldwide ahead of Nokia in Western Europe and Asia for the first time, as sales to end users tripled year over year to reach 24 million.
Samsung's Galaxy smartphones, which now cover a broad range of prices, pushed the company into the number one spot. Analysts expect more competition in Q4 2011, not least because sales of the iPhone 4S, 4 and 3GS will capture share from Android manufacturers.
Apple shipped 17 million iPhones, an annual increase of 21%, but down nearly 3 million units from the second quarter of 2011 because of Apple's new device announcement in October.
Gartner said that Apple will bounce back in Q4 2011 because of its strongest ever pre-orders for the iPhone 4S in the first weekend after its announcement. Markets such as Brazil, Mexico, Russia and China are becoming more important to Apple, representing 16% of overall sales and showing that the iPhone has a place in emerging markets, especially now that the 3GS and 4 have received price cuts.
The Android OS accounted for 52.5% of smartphone sales to end users in Q3 2011, more than doubling its market share year-on-year.
"Android benefited from more mass-market offerings, a weaker competitive environment and the lack of exciting new products on alternative operating systems such as Windows Phone 7 and RIM," Cozza said. "Apple's iOS market share suffered from delayed purchases as consumers waited for the new iPhone. Continued pressure is impacting RIM's performance, and its smartphone share reached its lowest point so far in the US market, where it dropped to 10%."