According to the latest Worldwide Quarterly Mobile Phone Tracker forecast by IDC, we may expect global smartphone shipments to decline 3.5 percent to 1.31 billion units this year. IDC had previously predicted 1.6 percent growth for the year 2022. However, due to increasing challenges with supply and demand, it has decided to significantly reduce the forecast for this year.
According to IDC, Cupertino-based tech giant Apple is going to be the “least impacted vendor” this year because of its control over its supply chain. Moreover, iPhone customers happen to be in the higher-priced segment and therefore are not as impacted by macroeconomic issues such as inflation.
Issues such as supply chain constraints, inflation, weakening demand, and geopolitical tensions have been impacting all smartphone vendors. This has resulted in cutbacks, including even by major smartphone manufacturers such as Samsung and Apple. Barring any new setbacks, IDC expects these challenging circumstances to ease by the end of 2022. The market next year can be expected to recover with 5 percent growth.
The second half of 2022 might see the resolution of the semiconductor supply issues that have been affecting the global smartphone market lately.
The ongoing semiconductor supply issues will ease up 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 in IDC’s Enabling Technologies and Semiconductors team. “The bigger problem has been the tight supply of components such as PMICs, display drivers, and discrete Wi-Fi chips. Capacity is being increased for these semiconductors that are made in higher process nodes and newer versions of Wi-Fi chips are being made with newer process nodes. At the same time, demand is dropping. Combined, these supply and demand changes will put the market more in equilibrium.
The Cupertino tech giant had difficulty meeting the demand for the current iPhone, iPad, and Mac models in the second fiscal quarter of the year due to supply constraints. Apple has stated in April that it expects those issues to continue into the third fiscal quarter. As of now, the Mac and iPad seem to be considerably more affected by supply chain issues than the iPhone.