The smartphone market has been hit by several factors this year – recession and consequent decline in consumer confidence, and ongoing supply chain disruption and component shortages.
The latest forecasts from research firm IDC predict that the situation will not improve very much until the second half of next year. “We believe the global smartphone market will remain challenged through the first half of 2023, with hopes that recovery will improve around the middle of next year and growth across most regions in the second half,” said IDC’s head of consumer device tracking, Ryan Reith.
IDC has lowered its smartphone sales forecast for 2022 and 2023 again and now believes shipments will decline by 9.1% in 2022 compared to 2021, which is a reduction of 2.6 percentage points from the previous IDC forecast. For 2023, the firm shaved about 70m units off its previous forecast, citing “the ongoing macroeconomic environment and its overall impact on demand”.
The forecasters had previously reduced their 2022 forecast in June, having initially expected 1.6% growth during the year, before the impact of macroeconomic factors on costs and demand had become clear.
IDC points out that the negative effect may be particularly bad for 5G handsets if recession leads consumers to defer upgrades from 4G to 5G.
Qualcomm recently provided its own forecast, reducing its projections for global 5G handset sales to 650m units in 2022, down from a previous estimate of 750m.
To make matters worse for Apple, recent unrest in an iPhone assembly plant run by Foxconn in China could lead to a shortfall of up to 6m iPhone 14 Pro models. The plant,
in Zhengzhou, central China, has been affected by major worker protests since mid-October, over Covid lockdowns, pay and other working conditions. Further protests could delay production to a significant degree ahead of the crucial holiday sales season.
Apple warned of a decline in iPhone Pro shipments on November 6, though it did not provide any numbers – the 6m figure comes from Bloomberg calculations. In the third quarter, Apple had 17% global smartphone market share, in second place behind Samsung, shipping 51.9m units. IDC said overall smartphone shipments fell by 9.7% to 302m units in the quarter.