According to the latest report from the renowned market research agency IDC, global smartphone shipments will decrease by 3.5% in 2022 to reach 1.31 billion units. However, in 2023, IDC predicts there will be a rebound with a 5% increase in shipments. IDC previously predicted that smartphone shipments would grow 1.6% in 2022. However, it has now revised its data to show that the market is not in good shape. Still, IDC sees a near-term decline in the market, with a 5-year CAGR of 1.9% through 2026.
In fact, in recent months, many OEMs have reduced their orders, including Apple. However, IDC remains optimistic about Apple, believing its ability to withstand the pressure is stronger. Indeed, Apple strongly controls the supply chain and its customers are more high-end. Thus, the firm has a stronger immunity to macroeconomics. The semiconductor supply problem will ease in the second half of 2022. However, the supply of 4G chips is still limited as the market shifts to 5G.
According to IDC, 5G mobile phone business will grow 25.5% in 2022, accounting for 53% of new shipments. The entire market will ship around 700 million units with an average selling price of $608. It’s worth mentioning that this IDC forecast has been downgraded significantly from the previous one. Meanwhile, IDC predicts that by 2026, 5G mobile phones will account for 78% of new shipments. Additionally, the average sale price will drop to $440. The average selling price of a 4G phone will be around $170 in 2022, dropping to $113 in 2026.
Global smartphone shipments will reach 309 million units in the second quarter
The average selling price of a phone in 2022 is expected to be around $402, falling to $366 in 2026. Additionally, IDC says global smartphone shipments in the second quarter of this year are expected to be around $309. million units. This is comparable to the first quarter but does not exclude the possibility of a downward adjustment. The current reality is that the demand in the smartphone market has dropped significantly over the past couple of years. Moreover, under the guise of the pandemic, cell phone makers are also cutting production.
This week alone, according to Korean media, Samsung’s mobile phone production this year will drop by 30 million units. For Samsung, 30 million mobile phones is not a small number, which means that Samsung mobile phone production this year will increase from the original plan of 310 million to 280 million. The decline in Samsung’s mobile phone production has long been traceable. Not too long ago there were reports that Samsung had cut its mobile phone shipment target for this year by around 10%. Reduced shipments mean reduced production.
The report also claims that Apple originally planned to ramp up production of the iPhone 13 Pro series in the second quarter. However, the latest report highlights that Apple couldn’t stay away and is likely to cancel plans to produce 20 million more phones in 2022.
Marks can’t escape cut commands
For mobile phone manufacturers, it is inevitable to cut orders and reduce production, because the current demand of the entire mobile phone market is difficult to compare with that of a few years ago. Also, young people who are the main consumers of mobile phone products are more reluctant to change mobile phone.
According to data released by market research firm Canalys in May, in the first quarter of 2022, global smartphone shipments were 311.2 million units, down 11% year-over-year. The repeated outbreak of the epidemic has led to tight supply chains, and industry involution has advanced the stagnation of product potency.
Moreover, the price of foldable smartphones is decreasing year by year. Additionally, there are reports that users may be turning to tablet PCs.