Even though smartphone companies have launched or launching devices aggressively, the sales are likely to fall three percent this year. The new study conducted by Counterpoint said that the total sales of the devices are expected to decrease by three percent year on year.
According to the report, the smartphone market is expected to shrink to 1.36 billion units in 2022. The report forecasts that the supply situation might improve in 2022 as against last year, but component shortages are still there. Also, chances of recovery are failing due to China’s recession and the ongoing war between Russia and Ukraine.
Peter Richardson, Vice President at Counterpoint Research, said, “For the long term, we continue to expect a steady migration from feature phones to smartphones and 3G/4G to 5G smartphones. As efforts to spread low- and mid-priced 5G devices continue, the global market for 5G devices are expected to show healthy growth and act as a significant driver of the overall smartphone market.”
Possible Reason Behind Smartphone Sales Decline
The report also pointed out that China’s zero-tolerance approach towards the COVID-19 and lockdowns in the cities are the behind slowing down its economy. Plus closed factories and rising logistics costs are causing chain reactions in the global economy.
In addition, the report said that the war between Russia and Ukraine also plays an important role as consumer sentiment has declined due to global uncertainty. Plus, the decreasing impact of the dollar is also impacting emerging countries.
Expected Recovery In Second Half
“However, the outlook for a smartphone market recovery in the second half still stands. At the end of May, the Chinese government convened a meeting for large-scale economic stability countermeasures. The government is expected to implement more aggressive policies to stimulate the economy in the second half. Besides, we believe that new foldable smartphone launches, led by Samsung, will be able to stimulate demand in the premium segment,” said Senior Analyst Liz Lee added.
