Smartphone market accelerates decline, predicting a new global economic crisis

Without being able to find a justification in the difficulties with semiconductor supply the smartphone market accelerates its decline from 9% in Q3-2022, registering the worst development since 2014 and so far.

Initially, last year’s bottleneck appeared to be attributed strictly to reported supply chain issues due to quarantine measures taken to manage the COVID-19 pandemic. In the meantime, the decline has been accelerated first by the lack of appetite of buyers who “stocked up” during the pandemic period with devices good enough not to require immediate replacement, and then by fears of a new global recession. And the reasons for this are many, from Russia’s war of aggression against Ukraine to China’s escalating housing crisis, reminiscent of similar experiences in the rest of the world after 2007.

Returning to the statistics, Apple is one of the few companies to come out narrowly on top. Positioned very close behind, Samsung retains 22% of the global smartphone market, followed in the top 5 by major players Apple, Xiaomi, Oppo and Vivo.

Justifying the data, Canalys analyst states:

“The smartphone market is highly responsive to consumer demand, and vendors are adapting quickly to tough business conditions.” “For most suppliers, the priority is to reduce the risk of inventory build-up, given deteriorating demand. Suppliers had significant inventories in July, but sales have gradually improved since September due to aggressive discounts and promotions.”

Thus, smartphone sales fell sharply globally, averaging 9% for Q3-2022. In fact, lacking privileged access to component suppliers and financial resources for aggressive promotion, some manufacturers were hurt even more than, for example, Apple.

As for the immediate period ahead, developments are highly dependent on global economic conditions, heavily influenced by political factors such as the war in Ukraine. Thus, in the absence of really positive news from the European “front”, the chances of the current sales decline turning into a prolonged lethargy are increasing.