According to a recent report from Omdia, global smartphone shipments decreased by 4% in the second quarter of this year (April-June) compared to the same timeframe in 2022. This decline is primarily attributed to the ongoing memory crisis, which has driven up component costs and resulted in higher device prices.
Despite the overall decline in shipments, both Samsung and Apple saw an increase in their market shares—Samsung grew from 20% to 22%, while Apple's share rose from 16% to 20%. In contrast, Xiaomi's market share fell from 15% to 11%, Oppo's from 12% to 10%, and vivo's from 9% to 8%.
Samsung remains the market leader, with Apple closing the gap. Samsung has benefited from growth in the budget segment, as its Chinese competitors have reduced their product offerings and raised prices. Apple achieved its best second quarter ever, largely due to the success of the iPhone 17 series and its decision not to increase prices.
Sales have been particularly challenged in the under $400 price range, “where supply constraints are tightest, profit margins are slimmest, and price sensitivity is highest,” noted Runar Bjorhovde, Omdia’s Principal Analyst. Memory and storage now comprise over 60% of the bill of materials for budget devices and more than 30% for premium models. Expectations indicate that memory price declines will only begin in the latter half of next year, with prices remaining unlikely to return to pre-2025 levels.
Omdia anticipates that Q3 and Q4 will see the most significant sales declines. As budget-conscious consumers face a shrinking array of options, vendors are expected to focus more on higher price segments, causing many “mass-market buyers” to postpone purchases, lower their expectations, utilize financing, or opt for refurbished devices.
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