With Huawei just launching the Mate50 Pro and Samsung set to launch its flagship device on February 1st, early data suggests that worldwide smartphone shipments have dropped significantly.
According to preliminary data from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker smartphone shipments fell 18.3% year-on-year to 300.3 million units in the fourth quarter of 2022 (4Q22).
The biggest drop
Nabila Popal, director of research with IDC’s Worldwide Tracker team, said the drop marked the biggest decline in a quarter and represents an 11.3% decline for the year.
“2022 ended with shipments of 1.21 billion units, representing the lowest annual shipment total since 2013 due to consumer demand, inflation, and uncertain economic conditions.
“This difficult close to the year puts the recovery of 2.8% expected for 2023 in serious danger with the risk of a severe fall to the forecast. We have never seen shipments in the holiday quarter lower than the previous quarter.
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Demand is weakening
Popal said weak demand and high inventories have led vendors to drastically reduce shipments.
“Several sales and promotions during the quarter helped reduce existing inventory rather than drive shipping growth. Vendors were more cautious in their shipments and plans as they reset their focus on profitability.
“Even Apple, which has so far appeared immune, is experiencing setbacks in its supply chain with the unexpected shutdown of key factories in China. What this holiday quarter tells us is that rising inflation and growing macro concerns continue to weigh on consumer spending more than expected and pushing the possible recovery until the end of 2023,” he said.
Be careful
With 2022 declining by more than 11% for the year, 2023 is set to be a year of caution as vendors will rethink their device portfolios while channels will think twice before taking on excess inventory.
However, on a positive note, consumers may find cheaper trade-in deals and promotions continuing through 2023 as the market will think of new ways to drive upgrades and sell more devices, especially top-of-the-line models.
Compiled by Faizel Patel, Senior Digital Journalist
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