According to Counterpoint Research’s Market Pulse Service, smartphone sales globally have fallen below the 100 million mark in May 2022. The research said that the global market sales of smartphones declined by 4 per cent month-on-month (MoM) and 10 per cent year-on-year (YoY) in May this year, reflecting a steady decline in MoM sales. This is the second decline and the 11th consecutive fall. In YoY sales. The report said that after witnessing a V-shaped recovery after the COVID-19 pandemic, smartphone sales are yet to reach the pre-pandemic mark.
According to a report by Counterpoint Research’s Market Pulse Service, smartphone market sales globally fell to 96 million units in May 2022. This is called a 4 percent drop in sales MoM and a 10 percent drop in sales. This marks the second consecutive fall in MoM sales and 11th consecutive decline in YoY sales, the report said. It said that, even after a V-shaped recovery from the COVID-19 pandemic, global smartphone sales still haven’t reached pre-pandemic levels. The smartphone market was hit by supply-chain bottlenecks and persistent COVID-19 waves in 2021. The component shortage is said to be stabilizing this year.
The report said that due to rising inflation, China’s economic slowdown and the Russo-Ukraine war in 2022, there is a decrease in demand in the smartphone market. Low demand is said to be leading to inventory build-up, resulting in a drop in shipments and cutting orders from smartphone makers. In the second quarter, sales may be the most affected, with the situation expected to improve in the second half of 2022.
Talking about China market and Russia-Ukraine war, Senior Analyst Varun Mishra said, “China’s lockdown and prolonged economic slowdown is hurting domestic demand as well as weakening global supply chain. The smartphone market in China recovered slightly month-on-month in May as the lockdown was eased, however, it remained down 17 per cent from May 2021. A new baseline market size may need to be defined for China’s smartphone market. Also there is uncertainty arising from the Russia-Ukraine crisis, which is affecting demand in Eastern Europe. No OEM has been spared from the negative impact on demand due to a mix of these factors.
According to the Counterpoint Macro Index, the situation is expected to improve in the second half of 2022 as China’s economic situation normalizes, supply and demand in technological supply chains improve, and the macroeconomic outlook improves. According to the report, June marks the beginning of the promotion period in several regions, such as 618 in China and Diwali in India, followed by Christmas and New Year. The launch of Samsung Galaxy Z Fold 4 and iPhone 14 series is likely to help increase the demand for the smartphone.
Talking about inflation, Tarun Pathak, Director of Research, said, “Smartphone demand, especially in advanced economies, is driven by substitution, which makes it a discretionary purchase. And pessimistic consumer sentiment across the world from inflationary pressures. With people postponing non-essential purchases, including smartphones. Emerging economies are also hurting by the strengthening of the US dollar. A section of consumers has been asked to pre-purchase purchases to relieve some cost pressures. There is a possibility to wait for the seasonal promotions.”