NPD: Prepaid Fuels Q2 Smartphone Unit Growth

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Port Washington, N.Y. – Unit sales of smartphones to U.S. consumers grew 9 percent in the second quarter, but prepaid smartphones accounted for all of the gain, The NPD Group found.

Unit sales of post-paid smartphones were flat, but prepaid smartphone unit volume rose 91 percent compared with the year-ago quarter, NPD said.

NPD also found that most of smartphone sales growth in the quarter was attributable to Samsung and Apple, whose combined smartphone unit sales rose 43 percent in the quarter compared with the year-ago period. Unit sales for other brands fell 16 percent.

“Prepaid smartphones are no longer just cheap, also-ran options focused on older and less-capable phones,” said Stephen Baker, NPD Group’s industry analysis VP. “As the smartphone market matures, and as growth slows, carriers have been smart to aggressively market some of their best current smartphones on a prepaid basis to a new set of customers in order to keep sales humming along.”

 NPD also found that the income level of the average smartphone buyer is heading down. In the second quarter of last year, 24 percent of smartphone buyers had average household incomes of less than $35,000 per year. In the second quarter of 2012, the number jumped to 33 percent. Among smartphone buyers in the quarter, 71 percent of prepaid smartphone buyers had an average income of less than $35,000, up by 12 points over the year-ago quarter.

The company also determined the top-five smartphone brands by share of units sold to consumers in the quarter. The brands and their shares are Apple (31 percent), Samsung (24 percent), HTC (15 percent), Motorola (12 percent) and LG (6 percent).

For its report, NPD excluded sales of cellphones purchased by businesses and given to employees.

In other stats, NPD told TWICE that prepaid smartphones represented 18 percent of all smartphones sold in the second quarter and that smartphones accounted for 39 percent of prepaid phones sold in the quarter.


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