Smartphone Market Records Lowest 3rd Quarter Shipments in 3 Years

India’s smartphone market witnessed a decline of 10 percent YoY shipping 43 million units in 3Q22 (July-September). As per IDC’s Worldwide Quarterly Mobile Phone Tracker, this was the lowest third-quarter shipment since 2019 despite an earlier onset of the Diwali festivities. According to the analyst firm, weakening demand and increasing device prices negatively impacted festive buying.

The report highlighted that high channel inventory was a concern even with vendors’ focus on channel schemes and price corrections to clear the stocks. Overall, the average selling price reached a record $226, growing by 15 percent YoY and 6 percent QoQ.

Upasana Joshi, Research Manager, Client Devices, IDC India shared that the ASP grew consistently for the past eight quarters due to increasing costs and growing 5G shipments at mid-premium price points.

The IDC report highlighted that the online channels clocked a record 58 percent share, shipping 25 million units. Multiple rounds of eTailer sales were supported by preferential platform pricing, online exclusive deals, and offers/discounts. Offline shipments declined by 20 percent YoY with aggressive action in the online channels.

In addition, 5G reached 36 percent of total smartphones in 3Q22 with 16 million units. India shipped 67 million 5G smartphones between 1Q20 and 3Q22; the ASP for 5G smartphones dropped to $393 from $509 in the same period. MediaTek-based smartphones led the market with 47 percent share followed by Qualcomm-led at 25 percent.

According to the report, shipments for the sub-$300 segment declined by 15 percent YoY, while the premium segment of $500+ continued to remain the highest growing category with 64 percent growth YoY and 8 percent share. Apple led the premium category with 63 percent share, followed by Samsung (22 percent) and OnePlus (9 percent).

However, Xiaomi maintained its lead, but with declining shipments (-18 percent) YoY in 3Q22. The company pushed more than 70 percent of shipments to online channels, resulting in a share of 27 percent of the online channel.

Samsung regained its second slot, despite flat shipments of 8 million in 3Q22. The company led the 5G segment with a 27 percent share, with 53 percent of its portfolio already on 5G.

On the other hand, Vivo dropped to the third position, with a 20 percent YoY decline in shipments, followed by Realme with shipments declining at 18 percent YoY. Oppo remained at the fifth spot.

Navkendar Singh, Associate Vice President, Devices Research, IDC informed that 2022 is likely to see shipments of around 150 million units, a decline of 8-9 percent YoY. The impact of inflation on consumer demand, increasing device costs, and slow feature phone-to-smartphone migration are the major challenges that will affect shipments in 2023. However, migration to 5G smartphones will offer growth to the market, especially in the mid-premium and above segments.