Smartphone Shipments Decreased 12.9 Percent in 1Q22

Global smartphone shipments showed a negative growth of 12.9% compared to the same period last year according to Omdia. The report also revealed that smartphone shipments recorded 308.0 million units and that the negative growth trend has been the case for the last three consecutive quarters. Notably, shipments by Chinese manufacturers have fallen sharply due to the slowdown in the Chinese domestic market.

The spread of COVID-19 in China particularly in the first quarter of 2022 has negatively impacted the smartphone supply chain and demand as the Chinese government locked down major cities including Shenzhen and Shanghai. This, coupled with the contraction in consumption caused by the continued economic slowdown, resulted in a sharp decrease in shipments from Chinese companies, which are highly dependent on domestic demand.

Samsung shipped a total of 73.8 million smartphones, a decrease of 2.9% on a yearly basis, but an increase of 6.8% compared to the previous quarter. Samsung's market share increased by 2.5 percentage points compared to the same period last year to 24.0% due to the small decrease in shipments compared to Chinese rivals.

Apple shipped a total of 56.4 million units, and its market share increased significantly to 18.3%. Share in the first quarter increased from 13.3% in 2019, 14.0% in 2020, and 15.6% in 2021 to 18.3% this year, growing for the four consecutive years. Shipment volume increased by 2.5% compared to the same period last year, making it one of the three companies that recorded year-on-year growth among the top 10 brands.

Xiaomi shipped 42.4 million units in the first quarter, 7.1 million less than 49.5 million units last year. Intensified competition with other Chinese companies in India and Southeast Asia, which are Xiaomi's main markets, and the slump in the domestic market caused the decline. However, the dependence on the Chinese domestic market was relatively low compared to Oppo and Vivo, so the Year on Year (YoY) shipment decline was 14.3%, lower than that of competitors.

Meanwhile, Oppo and Vivo, which are highly dependent on China's domestic market, shipped 25.3 million and 24.1 million smartphones respectively, down 33.1% and 36.9% compared to the same period last year. As a result, the market shares of the two companies fell to 8.2% and 7.8% compared to the same period last year. On top of weakening local smartphone demand in China, the growing business of Honor led the two companies are losing market share and shipments. More than half of shipments of Oppo and Vivo come from the local market.

The lockdown of major cities in China continues into the second quarter, and the Russian invasion of Ukraine is expected to have a negative impact on demand for smartphones in the second quarter as it directly or indirectly affects not only these two countries but also other regions. It is feared that this will negatively affect overall demand this year, which was expected to recover with post covid.