Weak fourth quarter caps bad year for smartphones

The global smartphone market continued to dwindle in the fourth quarter of 2022, capping a poor year for the sector, with a 12 per cent contraction compared to 2021, according to a report released this week by industry analysts Canalys.

According to the report, smartphone sales across the world decreased by 18 per cent during the fourth quarter, amounting to 296.9 million units in total.

With demand declining, smartphone manufacturers sold less than 1.2 billion units throughout the entire year, resulting in the aforementioned 12 per cent year-on-year fall in annual sales.

“Leading markets struggled with sharp shipment declines toward the end of 2022, hitting both Samsung and Apple hard,” Canalys analyst Sanyam Chaurasia said.

“Despite showing some stabilisation in the third quarter, Asia Pacific and Europe suffered their worst fourth-quarter performances in history in 2022,” he added.

What is more, according to Chaurasia, smartphone stocks piled up in key markets, including India and China, which resulted in a poor performance during the final quarter of the year.

Meanwhile, Chaurasia explained, adverse economic conditions had a negative impact on consumer spending in both North and Latin America.

“Vendors must carefully plan their new product launches as retailers and telcos are reluctant to increase inventory levels,” Chaurasia stated.

Furthermore, the top five smartphone vendors in 2022 remained the same as the previous year, with Samsung holding on to its first-place position, reflecting its share of 22 per cent of the market, having sold 257.9 million units.

Apple took second place with 232.2 million sales and a 19 per cent market share, despite finishing 2022 with its first-ever double-digit sales drop during the fourth quarter, something which Canalys attributed to weaker demand and issues affecting the company’s manufacturing capacity.

“Moving into 2023, Apple and Samsung are better placed to navigate ongoing uncertainties thanks to their high-end dominance,” Canalys research analyst Le Xuan Chiew said.

“The popularity of iPhone Pro models will help Apple extend its revenue share, despite overall demand being under pressure,” Chiew concluded.