Canalys, a leading global tech market analyst firm, has reported that worldwide smartphone shipments had fallen 17% in the fourth quarter of 2022 compared to the same period in 2021. Amid the supply chain disruptions and tough market conditions, the iPhone managed to reclaim the top spot with a 25% market share, a 2% increase from the previous year.
Samsung came in second place with a 20% market share but was the biggest vendor for the full year. Xiaomi, OPPO and Vivo rounded out the top five smartphone vendors, with market shares of 11%, 10% and 8% respectively.
Canalys Research Analyst Le Xuan Chiew said that vendors will approach 2023 cautiously, highly prioritizing profitability and protecting market share during difficult market conditions.
The factors that are likely to restrict the growth potential for the smartphone market include: inflation, interest rate hikes, economic slowdowns, and a struggling labor market. Despite these, Apple reclaimed the top spot, all thanks to the strong consumer demand for the iPhone 14 Pro and iPhone 14 Pro Max. The tech company has since then caught up with demand, with average lead time for delivery being four days across all four iPhone 14 models, and the devices are available for pickup in Apple Stores in the US.
Aside from the iPhone 14 Pro and iPhone 14 Pro Max, other iPhone models also performed nicely in Q4 2022, with average lead times for delivery estimated at four days. This implies that there is still a strong consumer demand for smartphones, despite the tough market conditions.
As for vendors, cutting costs to adapt to the new market scenario and building strong partnerships with the channel will be important for protecting market shares as difficult market conditions for both channel partners and vendors can certainly result to strenuous negotiations.
Canalys forecasts flat to marginal growth for the smartphone market in 2023, but with the increasing market share of Apple and the company catching up with demand, it is likely that the market will start to recover.