Global smartphone sales take a hit; fall below 100 million units in May: Counterpoint
For the second time in a decade, smartphone sales across the globe have fallen below 100 million units. As per a recent report by Counterpoint Research’s Market Pulse Service, global smartphone sales declined to 96 million units in May. Compared to April, smartphone sales in May witnessed a 4 per cent decline and a 10 per cent decline compared to May last year.
It was only during the COVID pandemic that the market slumped below the 100 million unit mark. Even though the market did not reach the pre-pandemic level, it was doing well despite the component shortage and multiple Covid-19 waves in recent months. The lockdown in China is a reason for the decline in the last two months. But Counterpoint’s research suggests the ongoing Russia-Ukraine war and inflation across different nations are the major concerns for the smartphone market.
“The demand for a smartphone, especially in the advanced economies is driven by replacement, which makes it a discretionary purchase. And inflationary pressures are leading to pessimistic consumer sentiment around the globe with people postponing non-essential purchases, including smartphones. The strengthening US dollar is also hurting emerging economies. A segment of consumers is likely to wait for seasonal promotions before purchasing to offset some of the cost pressures,” said Tarun Pathak, Research Director, CounterPoint on inflationary pressure.
Due to a decline in demand, smartphone manufacturers are ending up with unsold units in their inventory. A report suggested that Samsung has around 50 million unsold units in its distributor stock waiting to be sold.
The firm believes that the situation will improve as we progress through the second half of the year.
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