The smartphone industry has been heading for a gradual slowdown since before the Covid pandemic hit nations globally. Now, it seems like the days of expanding markets and bi-annual upgrades are eventually ending. Additionally, the rising inflation, supply chain constraints, and other financial hurdles have only increased this slowdown drastically in the last couple of years. As a result, Samsung reportedly plans to cut down on its smartphone production by 30M units.
The news comes from a highly reputable South Korean newspaper, Maeil Business News. Consequently, the world’s leading smartphone manufacturer is pulling back on production for 2022 by almost 30 million units. In addition, the sudden yet unsurprising news comes at the heels of hampering sales due to increasing conflict in Ukraine. The South Korean company had followed other tech giants like Microsoft and Apple in suspending sales in Russia in March.
Furthermore, the production decline is also due to rising inflation, subsequent consumer spending, and component shortage besides the Ukraine-Russia conflict. Additionally, Samsung is likely to adjust production for various devices with different price ranges, from entry-level to flagship models.
Moreover, the company initially planned to manufacture 310 million smartphones in 2022. But, the latest hurdles forced the South Korean tech giant to reduce it to 280 million units. And this is despite Samsung’s record-breaking Q! Revenues and an estimated 73.7 million smartphone shipments worldwide. And unfortunately, Samsung is not the only tech giant to cut down on its smartphone production this year.
Apple gets hit too
Apple also shut down its previous plans to manufacture additional 20 million phones in 2022. According to the report, the Cupertino giant’s numbers will likely remain flat from 2021. Additionally, the company is cutting down production to make 20% fewer iPhone SE units. And this is despite Apple’s latest upcoming model – the iPhone 14.
The latest issues have led to this scenario we are facing now in the smartphone industry. However, the big tech companies like Samsung and Apple will come out of it largely unaffected. But, the more important question is this – is this just a lull after a successful decade for smartphone sales, or is this bigger than that? So big that even the advent of new technologies will not be able to bring smartphones to their original glory.