NEEDHAM, Mass., June 1, 2022 – According to a new forecast from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, smartphone shipments will decline 3.5% to 1.31 billion units in 2022. After three consecutive quarterly declines and With growing supply and demand challenges, IDC has significantly reduced its 2022 forecast from the previous growth projection of 1.6%. However, IDC expects this to be a short-term pullback as the market rebounds to a five-year compound annual growth rate (CAGR) of 1.9% through 2026.
“The smartphone industry faces growing headwinds on many fronts – weakening demand, inflation, lingering geopolitical tensions and lingering supply chain constraints. However, the impact of lockdowns in China – which n have no clear end in sight – is far more important,” said Nabila Popal, research director at IDC Worldwide Mobility and Consumer Device Trackers. “The lockdowns have hit global demand and supply simultaneously by reducing demand in the world’s largest market and tightening the bottleneck of an already difficult supply chain. As a result, many OEMs have reduced their orders for this year, including Apple and Samsung. However, Apple appears to be the least impacted supplier due to better control over its supply chain and because the majority of its customers in the high price segment are less influenced by macro issues like inflation this year and that the market recovers in 2023 with 5% growth.”
“Ongoing semiconductor supply issues will ease in the second half of 2022. On the SoC side, 4G SoC supply has been tight, but the market continues to shift towards 5G SoCs,” said Phil Solis, Research Director at IDC Enabling Technologies and Semiconductor Team. “The biggest issue has been the limited supply of components such as PMICs, display drivers and discrete Wi-Fi chips. Capacity is increased for these semiconductors which are fabricated in higher process nodes and new versions of Wi-Fi chips are being manufactured with new process nodes. At the same time, demand is decreasing. Combined, these changes in supply and demand will bring the market more into balance.
From a regional perspective, the biggest decline in 2022 is expected in Central and Eastern Europe (CEE) with shipments down 22%. China is expected to fall by 11.5%, or about 38 million units, accounting for about 80% of the global reduction in shipment volume this year. Western Europe is expected to decline 1% while most other regions will see positive growth this year, including Asia/Pacific (excluding Japan and China) (APeJC) with 3% growth, 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 expectations for this year have been reduced significantly due to increased channel inventory of 5G products in China and an overall reduction in market forecasts. In the long term, 5G is expected to reach a volume share of 78% in 2026 with an ASP of $440. In contrast, 4G ASP is expected to cost $170 in 2022, dropping to $113 by the end of the forecast period. There was a slight increase in short-term ASPs across all devices due to shortages and rising component and logistics costs. However, the trend will remain downward over the long term. Smartphone ASP will increase from $402 in 2022 to $366 in 2026.
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IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets in more than 100 countries around the world. Using proprietary research tools and processes, IDC Trackers are updated semi-annually, quarterly, and monthly. Tracking results are delivered to clients in user-friendly Excel deliverables and online query tools.
For more information on IDC’s quarterly mobile phone tracking, please contact Kathy Nagamine at 650-350-6423 or [email protected]
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International Data Corporation (IDC) is the world’s leading provider of business information, consulting services and events for the information technology, telecommunications and consumer technology markets. With more than 1,200 analysts worldwide, IDC offers global, regional, and local expertise on IT technology, benchmarking, and procurement, as well as industry opportunities and trends in more than 110 countries. IDC’s analysis and insight helps IT professionals, business executives, and the investment community make fact-based technology decisions and achieve their key business goals. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world leader in technology media, data and marketing services. To learn more about IDC, visit www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC blog for industry news and insights.
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