NEEDHAM, Mass. — According to the new quarterly global mobile tracker forecast from the International Data Corporation (IDC), smartphone shipments will decline 3.5% to 1.31 billion units in 2022. After three consecutive quarters of decline and increasing challenges in both supply and demand, IDC significantly lowered its forecast for 2022 from a previous forecast of 1.6%. However, IDC expects this to be a setback in the short term as the market rebounds to achieve a five-year compound annual growth rate (CAGR) of 1.9% through 2026.
“The smartphone industry is facing increasing headwinds from several fronts — weakening demand, inflation, ongoing geopolitical tensions, and ongoing supply chain constraints. However, the impact of lockdowns in China — which has no clear end in sight — is much greater,” she said. Nabila Popal, director of research at IDC’s Worldwide Mobility and Consumer Device Trackers.”The lockdowns affected global demand and supply simultaneously by reducing demand in the world’s largest market and tightening a bottleneck to an already challenged supply chain. As a result, many OEMs have cut orders for this year, including Apple and Samsung. However, Apple appears to be the least affected supplier due to greater control over its supply chain and because the majority of its customers are in the higher price segment and are less affected by macroeconomic issues such as inflation. Barring any new setbacks, we expect these challenges to ease by the end of this year and for the market to recover in 2023 with a growth of 5%.”
said Phil Solis, director of research for IDC’s Enabled Technologies and semiconductor team. “The biggest problem has been the undersupply of components such as PMICs, display drivers, and discrete Wi-Fi chips. Capacity is increased for these semiconductors that are manufactured on higher processing nodes and newer versions of Wi-Fi chips are manufactured with newer process nodes.” At the same time, demand decreases. Combined, these supply and demand changes will further balance the market.”
From a regional point of view, the largest decline is expected in 2022 in Central and Eastern Europe (CEE) with shipments down 22%. China is expected to decline by 11.5% or approximately 38 million units, accounting for about 80% of the global drop in shipment volume this year. Western Europe is expected to decline by 1% while most other regions will see positive growth this year, including Asia/Pacific (excluding Japan and China) (APeJC) with growth of 3%, the second largest region after China.
5G devices are expected to grow 25.5% year over year in 2022 and account for 53% of new shipments with nearly 700 million devices and an average selling price (ASP) of $608. Volume forecasts for this year have been significantly lowered due to an increase in 5G channel inventory in China and an overall decline in market expectations. In the long term, 5G is expected to reach a volume share of 78% in 2026 with an ASP of $440. In contrast, the price of 4G ASP is expected to reach $170 in 2022, dropping to $113 by the end of the forecast period. There was an uptick in ASP in the short term across all devices due to shortages and higher component and logistics costs. However, the trend will remain bearish in the long run. Smartphone ASP will drop from $402 in 2022 to $366 in 2026.
Read the full press release here.