A decade ago, it was the PC market that showed signs of fatigue, due to the emergence of smartphones and tablets. Today, it is the turn of the smartphone, which has fallen like never before in a year marked by inflation and economic crisis.
The second quarter of the smartphone market has been described as the ‘worst quarterly result in more than a decade,’ and the outlook for the entire year is equally bleak. The only company that had a positive quarter was, surprisingly, Google.
Data from the American market, but affecting the entire world
The latest report from Canalys on the state of the North American smartphone market shows that total shipments decreased by 22% in the second quarter.
Macroeconomic issues, such as rising interest rates and persistent inflation, have led to a decrease in consumer demand.
The second half of the year is expected to be slightly better, thanks to the launch of new models in the third quarter, such as the iPhone 15 and Google Pixel 8 families.
Despite people trying to curb their expenses in these times of economic difficulties, the premium segment (phones that cost more than $1,000) is expected to remain strong.
In fact, Apple and Samsung increased their shipments in the premium segment with a growth of 25% and 23%, despite overall year-over-year declines.
The same cannot be said for the budget section of less than $200, which is expected to struggle as prepaid demand wavers, a common trend in the United States.
In terms of brands, Apple continues to lead with 14.8 million shipments in the second quarter, a 20% decrease from a year earlier. Samsung, in second place, dropped by 27%, from 9 million to 6.6 million. Motorola decreased by 25% to 2.3 million. And TCL fell by 30% to 1.3 million.
The only company that recorded positive growth was Google, in fifth place, with a 59% increase, from 0.8 million shipments to 1.2 million.
The biggest decrease (43%) is recorded in the “Others” section, which includes devices under $200 mentioned earlier, such as prepaid phones.
It was recently reported that many of these smaller companies are closing instead of continuing to struggle: almost 500 brands have exited the smartphone market since 2017.
Canalys predicts a 12% year-over-year decrease in shipments for 2023. Looking ahead, a slight recovery (3%) is expected for 2024, while a 7% increase is forecasted for 2025. The analyst, however, warns that it’s unlikely shipments will surpass the 150 million unit mark before 2027.
