Apple iPhone 13, Samsung Galaxy S22 win – but the smartphone market in general is falling

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Global smartphone shipments in the second quarter of 2022 were at their lowest point since the pandemic hit in 2020, with 287 million units sold in the quarter.

Samsung shipped 6% more smartphones than in the same quarter a year ago, according to new figures from Canalys, but shipped 16% fewer smartphones than last quarter. Still, with 61.8 million smartphones sold, it was the leading supplier this quarter with a 21% share, ahead of Apple, which shipped 48.5 million iPhones and held a 17% market share.

“Despite a 6% annual growth rate, Samsung’s shipments fell 16% from the previous quarter as the supplier struggled with unhealthy inventory levels, especially in the mid-market,” said Canalys research analyst Runar Bjørhovde.

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Apple reported in its fiscal Q3 revenue last week that iPhone revenue is up 3% year over year to $40.67 billion, while Mac revenue is down 10% year over year to $7.38 billion. and iPad revenues are down 2% year over year to $7.22 billion. Even the growth of Apple’s previously high-growth services business had fallen from 17% in the second quarter to 12% this quarter.

Apple chief Tim Cook told CNBC it sees high costs in logistics, wages and certain silicon components. He noted that Apple was now hiring “intentionally”.

Xiaomi was in third place with 39.6 million units in Q2 2022, while OPPO was in fourth place with 27.3 and Vivo in fifth place with 25.4 million units, according to Canalys.

Canalys analyst Toby Zhu sees strange times ahead for the tech industry’s supply chain problems: Instead of shortages, suppliers now see the possibility of oversupply as demand gets weak.

“Supply chain shortages are no longer the most pressing issue as parts orders are rapidly being scaled back and suppliers begin to worry about oversupply,” Zhu said.

“It has led to price reductions for key components, lowering costs for suppliers. Sellers could use the additional savings to improve product competitiveness from new launches in the second half of the year. Old models even more difficult. The oversupply situation demands more of the planning capabilities of suppliers than the period of scarcity.”

China and the Global Pattern

Canalys also reported that shipments to mainland China fell 10% in the second quarter of 2022 to 67.4 million units. Major cities like Shanghai emerged from months-long COVID-19 lockdowns in early June, but the country’s June 18 “618” online shopping event didn’t have the impact it had in the second quarter of 2021 — except for Apple.

Apple shipped 9.9 million iPhones in the quarter and was in fifth place, growing 25% year-over-year. Honor was in second place with 13 million units sold, an 88% year-over-year growth. Vivo held the top spot with 13.2 million units shipped, but this was a 28% year-over-year decline.

“Apple is also benefiting from resilient demand in the high-end segment, despite severe lockdowns in key cities. The supplier’s active marketing during the promotional period has also contributed significantly,” said Zhu.

Cook said Apple saw sales in Chinese cities where the lockdowns took place in the first quarter of June, particularly towards the end of the month in line with 618 sales.

Separately, Strategy Analytics reported that global smartphone shipments fell 7% year-on-year to 291 million units in the second quarter of 2022. It put Samsung in the lead with 63 million units shipped, giving it a 22% share. It said demand for the newly launched flagship Galaxy S22 series remained strong, especially the more expensive S22 Ultra model. Apple shipped 48 million iPhones, up 3% year over year, giving it a 16% share.

This is Apple’s highest market share in the second quarter of the past 10 years, at the expense of leading Chinese brands hampered by sluggish performance in both domestic and foreign markets. Apple had a good quarter, led by the iPhone 13 series, which continued to increase volumes in the US, China and other key markets.

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