Samsung follows Apple’s lead with its own production of large smartphones

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After contracting in 2020 due to the abrupt start and devastating initial impact of the coronavirus pandemic on the supply chain and overall global customer demand, the smartphone market grew slightly last year, but could not exceed sales in 2019…or 2018. or 2017.

While the world’s top handset vendors, of course, entered 2022 with the expectation that both demand and production would finally return to the pre-pandemic levels of the mobile industry, lately all signs seem to be pointing in the opposite direction.
According to Canalys, Q1 smartphone shipments fell 11 percent compared to the same period of 2021 “in the midst of adverse economic conditions”, and at least as far as Apple and Samsung are concerned, the outlook for the rest of the year is certainly not rosy based on the latest rumors from parts suppliers, experts and insiders.

Problems for the Galaxy S22 family?

although this new Korean media reporttranslated here) actually doesn’t mention Samsung devices by name, it’s hard not to think of the S22, S22+, and S22 Ultra in the first place when you hear the company is viciously slashing its production targets “not just for the mid- to mid-range.” the low-end models, but also for flagship models (high-priced mobile phones).
For now, the three aforementioned Snapdragon 8 Gen 1 powerhouses are the main representatives of the latter group, and although one of them is widely Considered a major commercial hit shortly after its release, that initial popularity may have faded in recent weeks.

“Globally high prices” and the Russian invasion of Ukraine are cited as two main causes of this quite serious crisis that could culminate in about 30 million fewer Galaxy handsets produced by 2022 compared to The original target of Samsung.
While the tech giant clearly can’t do anything about the latter cause, the rapidly falling demand over the past few months could deeper recent price cuts from the Galaxy S22 Ultra.
the middle class Galaxy A53 5G also happens to be cheaper than you might have expected, and the same could be true soon, even for the low-end Galaxy A13. While we have no reason to doubt that this crisis is real and problematic for Samsung’s bottom line, the smartphone production target for 2022 remains sky-high, somewhere between 270 and 280 million units.

Nothing to worry about with the folding front

Unfortunately, if that new rumored range of 270 to 280 million eventually materializes, it’s safe to assume Samsung’s actual sales figures will drop from its estimated 2021 total of 272 million.

That’s because it’s believed that the market-leading brand produced a total of about 300 million smartphones last year, so assuming that gap remains largely unchanged, we can expect Samsung’s global shipment total to reach about 245 million units by 2022.

A volume drop of about 10 percent is definitely bad, regardless of “adverse economic conditions”, Eastern European wars and recurrent COVID-19 lockdowns in Asia impacting the supply chain, but for what it’s worth, foldable sales will still expected to grow from 13 to 18 million units.

In the grand scheme of things, this year’s future success Galaxy Z Flip 4 and Z Fold 4 may not sound particularly impressive… but in the long run, foldable devices could become paramount to Samsung’s overall growth potential.
High-end foldable devices could even help Samsung differentiate itself from Apple, which initially scaled down its production plans this year due to the low popularity of the mid-end iPhone SE 3 while reportedly looking at problematic demand for at least certain members of the iPhone 14 family in the coming months. The bottom line is that Samsung and Apple’s issues are similar, but different, but point to much the same systemic challenges for the smartphone market as a whole.

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