The smartphone market collapsed in 2022. After resisting for months, the iPhone was overtaken by the economic crisis in the last quarter of the year…
According to figures from IDC, iPhone sales fell sharply in the last quarter of 2022. Over the period, Apple only sold 72.3 million iPhones worldwide, up from 85 million devices last year. From one year to another, the American brand sold 14.9% fewer smartphones.
Generally, the last trimester is most lucrative time of year from Apple. The brand is indeed taking advantage of the release of its new iPhones, around October, and the end-of-year celebrations. During the winter festivities, many of the brand’s new products can be found under the Christmas trees.
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Market decline and production concerns
Like its Android competitors, Apple is affected by the decline in the smartphone market. According to IDC, global smartphone shipments have collapsed by 18.3% over the previous quarter in the space of a year. This is the largest quarterly decline ever recorded by the mobile phone market.
Inflation and the decline in purchasing power are significantly dissuading consumers from investing in a new phone… especially since manufacturers’ prices are once again on the rise. Total sales for 2022 confirm buyer disinterest. Manufacturers only sold 1.21 billion phones in a year. It is the first time since 2013 that brands ship so few smartphones in a year.
“This difficult end of the year seriously jeopardizes the 2.8% recovery expected for 2023”notes IDC, which estimates that the recovery could finally wait until the end of the year.
At the same time, Apple met major production problems. Foxconn, one of China’s leading manufacturers of iPhones, was forced to shut down for several days. The severe confinements decreed by Beijing were accompanied by violent riots in Zhengzhou, nicknamed the city of the iPhone. Despite a rapid recovery, Apple recorded an iPhone 14 shortage. The most expensive and popular models, the iPhone 14 Pro and Pro Max, were long unavailable… which contributed to the drop in sales.
“Even Apple, which has so far been seemingly immune, has suffered a setback”says Nabilla Popal, director of research at IDC.
Despite the shortage and the recession, Apple managed to maintain market share. The Californian giant still holds 18.8%, compared to 17.3% in 2021. Clearly, Android smartphone manufacturers have not nibbled away at the shares of the iPhone. All brands suffered from the recession. De facto, Apple remains the world number 2 in the sector, just behind the unbeatable Samsung.
Apple is caught up in the crisis… but not too much
iPhone sales figures suggest Apple is gradually caught up in the recession. According to financial observers, the Cupertino group should also present financial results at half mast for the fourth quarter of 2022. To prepare the ground, Tim Cook and Apple’s chief financial officer, Lucas Maestri, warned investors ahead of a sales slowdown phase.
So far, however, the company has been insensitive to the economic crisis, which began last year in the wake of the pandemic. The Cupertino giant even announced record quarterly results in October. Building on the summer success of the iPhone 13 and its new Macs, Apple has reaped $20.7 billion in profit and record sales of $90 billion.
Thanks to sales that remain solid, a colossal cash reserve and cautious recruitment during the health crisis, Apple should avoid going through massive layoffs to reduce its costs. The firm would be content to revise recruitment downwards in the coming months. In contrast, tech giants like Meta, Microsoft, Amazon and Google have cut their workforces sharply. More than 55,000 individuals have been laid off this month.
IDC
