Global smartphone shipments continue to drop: The reasons are persistent

A pile of smartphones from different brands on a black desk
(Image credit: Shutterstock / Tereza Hanoldova)

The last quarter (Apr-Jun) was among the most exacting for the global economy. The seemingly never-ending war in Ukraine. The seemingly never-ending pandemic induced problems. The seemingly never-ending global chip shortage. The seemingly never-ending political uncertainty in many countries.

All of these factors had an impact on the global economy. Many countries are faced with an impending inflation threat. The fear of recession is also looming in some other nations. 

Considering all these factors, it is no surprise that there is a worrisome drop in the global smartphones shipments. As matter of fact, it is a continuing trend.  According to a new report from the research agency Canalys, the global smartphone market fell 9% year-on-year (YoY) in the second quarter of the year. In a sense, this should ring some alarm bells in the corridors of powers across the globe.  

Economic headwinds, sluggish demand and inventory pileup have resulted in vendors rapidly reassessing their portfolio strategies for the rest of 2022, said the Canalys report.

Why this may be a good time buy a new phone

The performance of various smartphone brands

(Image credit: Canalys)

Among the individual brands, Korean major Samsung took the first place with a 21% market share as it strengthened its low-end A series supply. Apple came second with a 17% share as the iPhone 13 remained in high demand. Xiaomi, Oppo and Vivo continued to struggle in China, suffering double-digit declines to take 14%, 10% and 9% market shares respectively. 

"Falling demand is causing great concern for the entire smartphone supply chain," Canalys Analyst Toby Zhu said.  He predicted that in the near term, vendors will look to accelerate sales using promotions and offers ahead of new launches during the holiday season. "But in contrast to last year’s pent-up demand, consumers’ disposable income has been affected by soaring inflation this year. Deep collaboration with channels to monitor the state of inventory and supply will be vital for vendors to identify short-term opportunities while maintaining healthy channel partnerships in the long run." 

Basically, smartphone brands need to review their strategy as the situation looks to be mired in difficulty. The brands need to tweak their oversupplied mid-range, as budget-constrained consumers shift their device purchases toward the lower end.

The impending arrival of 5G services in markets like India does offer hope for the industry though. Also, as the brands, in a bid to stay afloat, offer handy discounts, this may also be a good time to pick the smartphone you have been wanting to for long.

Balakumar K
Senior Editor

Over three decades as a journalist covering current affairs, politics, sports and now technology. Former Editor of News Today, writer of humour columns across publications and a hardcore cricket and cinema enthusiast. He writes about technology trends and suggest movies and shows to watch on OTT platforms.