Reportedly, 2023 could become the bleakest period for the worldwide smartphone market. Anticipated data from Counterpoint Research suggests a potential 6% drop in shipments to 1.15 billion units, marking the lowest figure in a decade.
The report indicates that Asia could pose a significant obstacle to achieving positive growth. Economic recovery in China, initially expected at the beginning of the year, has been impeded by challenges, and the wider region is witnessing escalating declines in emerging markets.
Escalating regional macro uncertainties are reportedly causing smartphone replacement rates to reach unprecedented highs. Similarly, North America remains a significant impediment to global economic rebound, as its underwhelming performance during the first half of 2023 positions it for substantial double-digit declines for the entire year.
Additionally, the report highlighted that even with a robust job market and declining inflation, consumers remain cautious about upgrading their devices. This caution has led to both the US and global replacement rates reaching historically high levels.
The silver lining
One area that appears to be experiencing growth is the premium and ultra-premium segment. This trend is observable on a global scale. Favorable figures within this segment particularly benefit companies like Apple, which heavily emphasizes higher-end offerings.
Anticipations from the report suggest that 2023 could signify the initiation of a new chapter for Apple within the resilient premium market. The company’s notable performance in the United States might propel it to attain the top rank globally in terms of annual shipments, a milestone yet to be achieved.
Jeff Fieldhack, the research director for North America, remarked, “This is the closest Apple has come to securing the leading position. The difference in sales is merely a matter of a few days. Assuming Apple doesn’t encounter production challenges similar to last year, the outcome remains uncertain at this juncture.”
iPhone 15 launch may give further boost
Analysts are closely observing the fourth quarter due to the significance of the “iPhone 15 launch as an opportunity for carriers to attract valuable customers.” Jeff Fieldhack highlighted that with the substantial presence of the iPhone 12, competitive promotional offers to capture the customer base are expected to be vigorous, ultimately benefiting Apple.
Ethan Qi, Associate Director for China, mentioned, “Apple holds a strong position in China, benefiting from the ongoing growth of the premium segment.” This allows Apple to consistently expand its market share in the country.
