Smartphone shipments decline 8% in Saudi on back of new taxes

Total mobile shipments to Saudi Arabia declined quarter-on-quarter (QoQ) by 5.4 percent in Q1 2018, due to the introduction of value-added tax (VAT) and expat dependent tax, according to International Data Corporation (IDC).

In the smartphones category, shipments to the Kingdom fell for the fourth consecutive quarter in Q1, contracting 7.5 percent QoQ, the consulting firm said in its quarterly mobile phone tracker report.

"The size of the overall market in Saudi Arabia is expected to decline over the coming years as a direct result of the new expat dependent tax," noted Kafil Merchant, a research analyst at IDC.

The UAE saw mobile shipment decline by 14.7 percent QoQ in the first three months, as overall mobile shipments to GCC totaled 5.9 million units in Q1, down 9.9 percent QoQ.

The decline stemmed from a 19.7 percent QoQ contraction in feature phone shipments, a reversal of the strong 23 percent year-on-year shipment growth last year. Smartphone shipments declined 4.7 percent QoQ, with Q1 2018 representing the fourth consecutive quarter of decline.

The performance of the other GCC markets varied considerably in the first quarter, with Kuwait seeing a 3.9 percent QoQ decline in smartphone shipments, while Bahrain and Oman bucked the regional trend to post respective growth rates of 3.4 percent and 6 percent.

Meanwhile, Nokia dominated the vendor landscape for feature phones, garnering 87 percent share of the overall GCC market in the first quarter. On the smartphone front, Samsung maintained its lead with 35 percent share of the region's shipments, while Apple and Huawei ranked second and third with respective shares of 24 percent and 14 percent, said IDC.