It’s no secret that 2022 was a disastrous year for smartphone sales everywhere (at least relative to 2021), and that this downward trend won’t be reversed until at least 2023 (unlike previous attempts).
The premium segment, however, grew (somewhat) last year, bringing in more than half of the industry’s total revenue for the first time in history, according to a research from Counterpoint Research.
If you’re curious, “premium” handsets are those with a “wholesale” price of $600 or more per unit, and as you might expect, Apple has been massively dominating this market since, well, forever. The Cupertino tech titan had a phenomenal 2022, increasing premium smartphone shipments by 6 percent from an already staggering total in 2021 and jumping to 75 percent market share.
About three quarters of all mobile devices sold in the world in 2017 costing $600 or more were iPhones, leaving Samsung with only 16 percent of the market and everyone else fighting over the scraps. Huawei “won” the bronze medal for the premium market sector, although sales were down 44% from 2021 levels, thus the victory was really more of a loss.
Despite a similarly disheartening loss, Xiaomi nonetheless managed to conclude 2022 as the fourth largest premium smartphone seller in the world, behind only Honor and Google, both of which more than doubled their sales from 2021.
In contrast, Samsung’s 5 percent drop in premium handset shipments is largely blamed on a relatively late launch of the Galaxy S22 series and, more importantly, the company’s weak overall presence in China. This again confirms the hit status of both the Pixel 6 Pro and the Pixel 7 Pro (at least by Google’s standards).
Whatever the reasons may be, the fact that the leading smartphone manufacturer in the world has been so thoroughly defeated in this crucial conflict against Apple is certainly cause for concern. Samsung’s mobile division relies heavily on the income made from its flagship S-series handsets, despite the fact that it is also selling a very small number of midrange Galaxy A-series devices.
What is the future of smartphone market
Even though Samsung’s foldables are becoming increasingly popular, the company’s premium product lineup nevertheless closed the previous year on an uncharacteristically low note, which is a shame because they are one of the company’s few bright spots.
Even though Apple has no plans to enter the market for foldable phones, the industry anticipates that other companies will benefit from them in 2023 and beyond. While “traditional” iPhone flagships are still selling well around the world, Apple has no pressing need to diversify its high-end resources.
The experts at Counterpoint Research believe that Apple’s 75 percent share of the premium smartphone market in 2022 could have been even bigger if not for the “disruptions during the peak Christmas season” that occurred with the supply of the iPhone 14 Pro and 14 Pro Max. This is a quite incredible statement to make.
It may have had an impact on the segment as a whole, as sales volume increased by only 1 percent in 2018 compared to 2021. Even more impressive is the fact that premium smartphones generated 55% of the world’s total mobile hardware-derived revenue in 2022, despite accounting for “more than” a fifth of worldwide shipments.
This is obviously where the money is, so it must be discouraging for Google and its hardware partners to see only 25% of premium gadget sales going to Android. That’s why Google is stepping up manufacture of its own high-end smartphones in-house, although the Pixel lineup has a long way to go before it can compete with the mainstream appeal of Apple’s premium iPhones.
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