Omdia: Global smartphone shipments see 15.4% fall from the previous year, with even Apple taking a double-digit hit
3 February 2023
LONDON, 3 February, 2023 – New data from Omdia’s smartphone preliminary shipment report for the final quarter of 2022 shows that global smartphone shipments totaled 301.5 million units in 4Q22 marking a decrease of 15.4% compared to the previous year. Typically, the last quarter sees the most shipments, however, this year the tide changed with a disappointing and marginal 0.7% decrease compared to the previous quarter. In fact, most major set OEMs recorded significant negative growth compared to the previous year, double-digit falls in shipments.
As is typical in the fourth quarter of each year, Apple recorded the most shipments of any OEM: 74 million. This is a significant 41.6% increase from the third quarter of 2022, but still an 13.3% fall compared to the jump in shipments seen in 4Q21. Despite this fall in shipments year-on-year (YoY), its Apple’s market share increased YoY from 24% in 4Q21 to 25% in 4Q22 with other OEMs experiencing similar or greater falls. Despite this, Apple is still feeling the same hit that has impacted the whole smartphone market, with the fourth quarter of 2022 finally breaking Apple's eight-quarter/two-year streak of continued growth YoY, with every quarter from the fourth quarter of 2020 seeing positive YoY growth, until now.
“Apple seemed to be the one OEM resisting the overall decline in the wider market in the first three quarters of 2022, but it has now finally succumbed to the overall market conditions. Because its consumers are typically loyal and high-income customers, it was expected that the cost-of-living crisis wouldn’t affect Apple shipments in the same way it effects low and mid-range brands. But now, with the effects of inflation and production disruptions, Apple’s fourth quarter bump in 2022 is disappointingly small compared to the previous year. Despite this, early demand and customer feedback for the latest iPhone 14 Pro and 14 Pro Max has been really strong, thanks to a new front-facing display called Dynamic Island. Apple was confident in strong demand and had planned maximum production for these two models to counteract it. However, the suspension of production at the Foxconn plant put a damper on this,” said Jusy Hong, Senior Research Manager at Omdia.
Samsung, as is typical, falls from first to second place. Although this is not just because of Apple’s fourth-quarter boost, but also because of a 15.4% fall YoY, recording 58 million shipments in 4Q22 compared to 69 million in 4Q21. It also saw an 8.8% fall from the previous quarter, down from 64 million. Its market share, however, remains stable as other OEMs see larger falls.
The major Chinese OEMs are continuing to feel this decline in recent quarters. Xiaomi, Vivo, and Oppo, which each rank third to fifth in shipments, all recorded a decline of more than 25% in the fourth quarter compared to same period in the previous year. Xiaomi remains the third largest smartphone OEM by shipments, with 33 million recorded in 4Q22. But this is a significant fall from both the previous quarter (41 million in 3Q22, a 18.0% fall) and the previous year (45 million in 4Q21, a 26.5% fall).
Oppo Group and vivo swapped fourth and fifth place, although both see a decline. vivo shipped 24 million units in 4Q22, a minor fall from 25 million in 3Q22, but a big 25.8% fall from the 32 million units shipped in the previous year. Oppo Group saw an even bigger fall, from 29 million in the previous quarter to 23 million in the fourth quarter, a 20.3% fall. Compared to the previous year, it is a 29.1% fall from 33 million.
Both Transsion and Honor seem to be more resilient than other Chinese OEMS, seeing a smaller YoY fall than others. Transsion has the sixth highest shipment figures in the latest quarter, recording 17 million units, only a slight fall from the 18 million recorded in both the previous quarter and year. Honor's shipments in the fourth quarter totaled 14 million units. This is flat with the previous quarter but a slight fall from the 15 million units in the previous year.
Realme took eighth place, with 11 million units. This is a big 16.9% fall from the previous quarter and a massive 31.5% fall from the previous year – the biggest fall of any major set OEM. A decline is to be expected within the context of a declining Chinese domestic market, increasing tension with the Indian government, and turbulence in the eastern European market – all of which are key markets for the OEM. Regardless, it is surprising that Realme is falling further and faster than its competition that target the mid to high-end price range more. A big reason for this could be the heavy inventory problems the brand has experienced in 2022.
“A variety of things are causing the continued slump in Chinese OEM shipments, including a local economy recession, pandemic-related lockdown of major Chinese cities, and the sudden abandonment of the Zero-Covid policy has brought confusion to the market. Internationally, high inflation is cutting consumers’ disposable incomes, which negatively impacts Chinese OEMs who primarily target the low to mid-end price range. Many Chinese OEMs also continue to struggle in the Indian smartphone market, the largest international market for a number of brands. An unintended consequence of this reduction in demand was a significant increase in inventory. As a result, it is not surprising that OEMs are downgrading their shipment targets for each quarter, with this likely to continue for at least another two quarters.” said Zaker Li, Principal Analyst at Omdia.
Motorola remains in ninth place with 11 million units, flat with the previous quarter but a 10.4% fall from the previous year. Huawei holds its place in tenth place despite a fall in shipments for the first time in a year, recording 7.5 million units compared to the previous quarter’s 8.6 million. But this fall doesn’t erode the improvements the company has made in the past year, with this still representing a 59.6% increase YoY.
Over 2022, there were 1,207 million recorded shipments. This is a fall of 9.9% from the 1,340 million shipments recorded in 2021. Honor was the only major set OEM to see growth over YoY, having recorded 59 million in 2022 compared to 40 million in 2021. Apple and Motorola were the two OEMs most resilient to the general trend of decline, each seeing small falls of 1.3% and 1.4% respectively. Samsung’s final recorded shipments in 2022 are 259 million, the most of any OEM, but this is still a 4.8% fall from the 272 million recorded in 2021. Those most hit were the Chinese set OEMs, with Xiaomi, vivo and Oppo group all seeing significant double-digit falls in shipments YoY.
Hong concludes: “As forecasted by Omdia, OEMs’ shipments and targets have fallen, with many OEMS including Apple and Samsung falling further than predicted. So much is at play effecting consumer demand for smartphones, but the key driver is inflation squeezing wage packets and reducing disposable income. A strong dollar against other currencies also discourages OEM’s profitability and dampens promotions and marketing activities. On the production side, high inventories and low demand is resulting in continued reductions in production volumes. It will take time for the market to recover, with an increase in shipments unlikely until at least the third quarter of 2023.”