Premium Smartphone Sales Grow by 1% Despite 12% Overall Industry Decline

Inflationary pressures along with an assortment of other troublesome macroeconomic conditions have created a lot of issues for the smartphone industry. Smartphone sales declined by as much as 12% in 2022, but in spite of the fact that this is the case premium smartphones actually managed to see their sales increase by 1% with all things having been considered and taken into account.

Premium smartphones are essentially any phones that cost over $600, and their growth rate despite all odds has given the industry a lot of hope. With all of that having been said and now out of the way, it is important to note that the wider decline coupled with premium smartphones increasing sales has meant that high end models are now providing a majority of revenue from the entire industry.

Back in 2016, 7% of all smartphones sold were premium models. They also managed to accrue 18% of the total revenues generated from the industry that year. However, fast forward to 2023 and the story looks quite different. 21% of all smartphones sold are premium models, and they are also bringing in 55% of all revenues!

Such a change is interesting because of the fact that this is the sort of thing that could potentially end up indicating a shift in the wider industry. Premium smartphones are undeniably profitable, and even though they don’t see nearly as many sales, they are still helping OEMs to turn a profit.

We may actually see premium smartphones increasing their share even more, since buyers are clearly willing to pay an additional surplus cost in order to avail the benefits that high end models can send their way. 2023 will prove to be a litmus test for the entire industry.

Economic factors are continuing to wreak havoc unabated, and we may enter 2024 with a brand new industry that looks nothing like the one that existed just a few short years ago. Major players like Apple and Samsung stand to win the most in the end, although this means that smaller companies might end up falling by the wayside.

H/T: CounterPointResearch

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