Smartphone shipments are set to fall once again – so it might be worth buying now

Smartphone shipments are set to fall once again – so it might be worth buying now


Geopolitical and economic uncertainty is hindering any chance of recovery in the global smartphone market, with shipments falling during the first quarter of 2022 and ongoing challenges causing slower than expected growth this year.

Figures from Canalys show that overall shipments fell by 11% during the first three months of the year, with traditionally sluggish seasonal demand compounded by lockdowns in China, Russia’s invasion of Ukraine, and the rising cost of living in many other countries.

This has tempered optimism that 2022 would see the market rebound after the impact of global lockdowns, economic uncertainty, and an industry-wide component shortage that had all seen sales fall in 2020 and 2021.

China smartphone sales

However, it wasn’t all bad news at the high end of the market. Samsung’s refreshed portfolio saw it stegnthen its position as the world’s leading smartphone manufacturer, while demand for the iPhone 13 helped Apple increase its share of the market from 15% to 18%. Xiaomi, Oppo and Vivo make up the rest of the top five.

“Despite the looming uncertainty in global markets, the leading vendors accelerated their growth by broadening device portfolios for 2022,” said Sanyam Chaurasia, an analyst at Canalys. “While the iPhone 13 series continues to capture consumer demand, the new iPhone SE launched in March is becoming an important mid-range volume driver for Apple.”

“The global smartphone market was held back by an unsettled business environment in Q1,” added Canalys vice president of mobility Nicole Peng. “Markets saw a spike in COVID-19 cases due to the Omicron variant, though minimal hospitalizations and high vaccination rates helped normalize consumer activity quickly. Vendors face major uncertainty due to the Russia-Ukraine war, China’s rolling lockdowns and the threat of inflation. All this added to traditionally slow seasonal demand.”

A separate study by CCS Insight predicts the mobile phone market will increase by just 2.9% in 2022, with smartphone sales rising by 4.2% during the calendar year. However despite muted demand, the proportion of 5G smartphone sales will increase to 43%.

“Although supply conditions may remain volatile during 2022, improvements are expected throughout the year in time for the holiday fourth quarter. However, manufacturers now face weak consumer demand thanks to a difficult economic environment and potential challenges from the wave of Chinese lockdowns,” said James Manning Smith, senior analyst at CCS Insight. “A worsening economic outlook for 2022 is expected to produce a third year of weak sales since 2020, reducing demand for mobile phones in both advanced and developing markets.

“2022 will be a tough year, but there’s hope ahead if the global economy strengthens while navigating the current troubles. We project a 3.8% growth in overall demand for mobile phones in 2023, fuelled by 6.4% growth in smartphones during the year.”

 

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Rachel Meadows

Rachel Meadows

Trending topics news writer who enjoys cooking, walking her dog and travel.