Price hikes helped OEMs arrest sliding smartphone revenue in Q3 2022
Some exciting smartphone launches are coming up just around the corner in 2023, with high-profile devices like the Samsung Galaxy S23 series and OnePlus 11 already lined up. There’s a lot riding on some of those handsets, as looking back at smartphone sales across 2022, companies recorded asteady decline in revenue during Q1and evenQ2 2022, mostly fueled by the worldwide economic chaos, component shortages, and political turmoil. Thankfully, Q3 2022 broke this trend, allowing companies to stop their performance slumps.
Data from Counterpoint Researchshows the global smartphone market’s revenue was 3% lower in Q3 2022 than the same quarter last year, hovering close to the $100 billion mark. Analysts at the firm believe Q3 losses are lower than previous quarters this year because the average selling price (ASP) of smartphones went up 10% year-on-year (YoY) this quarter.
Part of that trend can be tied to the further proliferation of 5G devices, which demand higher prices than their LTE predecessors, and contributed a whopping 80% to the smartphone industry’s revenue in Q3, up from just 69% in Q3 2021. In terms of shipment volumes, 46% of the smartphones sold had 5G capability, although overall sales dipped 12% YoY. Laying some statistics down, Counterpoint Research senior analyst Harmeet Singh Walla said:
At over $80 billion, the revenue contribution of 5G handsets reached an all-time high of 80% of global handset revenues, up from 69% in the third quarter of last year. In the same period, LTE handsets’ revenue contribution fell 10% to $19 billion.
Samsung’s ASP rose just 2% but its 5G phone-fueled revenue swelled 27% in the same period. The Korean brand also seriously increased the number of Galaxy Flip and Fold shipments from a year ago. Xiaomi’s 4% YoY revenue growth in Q3 2022 was helped by low- and mid-range phones, but its ASP still grew by a whopping 14% YoY. Oppo (with OnePlus included), on the other hand, saw revenue decline 27% and its smartphone ASP dropped by 5% compared to Q3 2021.
Where do we go from here? Time will tell, but continual innovations coming to the smartphone industry, coupled with the overall increase in average selling price should make for a rather interesting Q4 2022.
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