Analysis
Retail

Apple, HP and Dell lose market share in Gulf

December 3, 2024, 8:34 AM

Shoppers look at Apple electronics in a Dubai store. Its phone and laptop sales are down in the Gulf — Shoppers browse at an Apple Store in Dubai. Its phone and laptop sales are down in the Gulf

Samsung GCC’s No 1 phone brand
Chinese manufacturers on rise
US food brands hit by boycotts

Apple, HP and Dell are losing market share in the Gulf, analysts have told AGBI, but their weakening position appears to be due to the allure of their rivals rather than a boycott of American brands.

The region’s relatively wealthy, young and tech-savvy consumers are an attractive target for makers of smartphones, tablets and computers.

Samsung remains the Gulf’s smartphone brand of choice. The South Korean company accounted for 40.1 percent of phone shipments to the GCC in the first nine months of 2024, down from 40.6 percent in the same period in 2023, according to analyst IDC.

Apple suffered a bigger decline in Gulf market share while shipments increased for the Chinese duo Xiaomi and Transsion.

Overall, smartphone shipments for Q1 to Q3 rose 8.9 percent year on year.

Many consumers in the Middle East and North Africa have been boycotting American food and beverage brands in protest at the US government’s support for Israel in the Gaza conflict.

McDonald’s blamed the “continued impact of the war in the Middle East” as well as poor performance in China for a 3.5 percent decline in third-quarter sales at its international franchise division.

Starbucks’ international sales fell 4 percent in the year to September 29, in part because of a customer boycott. Coca-Cola and Pepsi have also been affected.

However, higher-value electronics do not appear to be subject to an extensive boycott in the Gulf – yet.

IDC research manager Akash Balachandran attributes the Gulf’s changing smartphone market to Samsung’s success in the ultra-premium, $1,600-plus segment, while Xiaomi and Transsion thrive with low-cost handsets that sell for less than $100.

China’s Lenovo has become the top seller of desktop and laptop computers in the GCC, IDC data shows. Market share has dropped for the US giants HP, Dell and Apple, as well as for Taiwan’s Asus.

Isaac Ngatia, a senior research analyst at IDC in Dubai, says: “HP has been impacted by the reprioritisation of spending in the Saudi Arabia market.”

Dell is traditionally a “strong player in the desktops market”, he says. “However, demand for desktops has been declining.”

It has focused on business-to-business sales although this accounts for about half the market, according to Ngatia.

“Lenovo has had a balanced run in both consumer and commercial segments, with varied models to suit these segments across the GCC,” Ngatia says.

Apple has fared better with its iPads, which accounted for 31.6 percent of tablet shipments to the GCC in the first nine months of 2024. Samsung’s shares of tablet shipments has fallen, while the Chinese newcomer Honor has gone from zero to 11 percent.

“Over the years, Apple has had a robust run in the consumer segment,” Ngatia says. “The push to the commercial segment has seen Apple not only defend its share, and continue to enjoy its premium brand position, but also increase its overall value in the market.”