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Global smartphone shipments have dipped sharply by 18.3% to 300.3 million units in the last quarter of 2002, reported IDC, making the holiday quarter the worst decline in a single quarter in 2022 and the fourth consecutive quarter for declined shipments. With smartphone shipments totaling 1.21 billion units in 2022, last year saw the lowest annual smartphone shipment since 2013, when shipments have slumped 11.3%.

Major smartphone makers suffered a significant decline. However, the standings of smartphone makers remained unchanged from a year ago, according to a report from Canalys. The Middles East suffered the greatest hit with a 20% decline. Europe experience a decline of 12%, while Asia Pacific reported an 8% drop in smartphone shipments in 2022.

Samsung claimed the first spot with a 22% market share and 257.9 million shipments, though it was down by 15.6%. Apple ranked second with a 19% market share and 232.2 million shipments. During the holiday quarter, Apple reported the first-ever double-digit decline, at 14.9%, partly due to iPhones production issues when factories in China were forced to shut down during Covid lockdowns.

This is one contributing factor leading to Apple’s report of its first decline in revenue in three and a half years, when total revenue stood at $117.2 billion, down 5.5% compared to the same period in 2021.

Coming in third with 152.7 million shipments, Xiaomi experienced the largest decline at 26.5%. OPPO and vivo took subsequent spots with 113.4 million and 101.9 million shipments, respectively.

But the biggest contributor to the overall slump in smartphone shipment remains to be weak demand driven by global layoffs, high inflation and lower spending as consumers and businesses brace themselves for recessionary times.

In the region, Asia experienced peak inflation against major economies including the US and Europe, an economist from Morgan Stanley relayed. To make matters worse, the average length of phone ownership is increasing.

In India, smartphone shipments plummeted 9% year-on-year, even though revenue stayed relatively unchanged, according to a Counterpoint Research report.

China’s smartphone shipments totaled 286 million, down 13% year-on-year, attributed to strict Covid measures that muted the Chinese economy and spending. Despite China’s reopening, factory activities have yet to rebound significantly. However, Apple has said that supply chain issues impacting its iPhone shipments have been resolved and “production is what we need it to be”.

To make matters worse, IEEE has reported that more people are holding on to their existing phones for more than three years. With 5G still in its infancy stages in most countries, newer smartphone models do not offer significant innovations and features. For the majority, upgrading their smartphones is not a priority in this economic and political landscape. In China, for instance, sales of smartphones in China declined 14% year on year in 2022 to record its fifth consecutive year of decline.

Plagued by weakened consumer demand and supply chain disruptions, China’s smartphone market might need some time to recover. However, industry watchers are more hopeful about the premium segment.

While consumers remain cautious about spending, the collective push for 5G acceleration and 5G-ready devices can potentially drive consumers to purchase smartphone models with 5G features, especially in countries where 5G services are more readily accessible, therein allowing for market growth.