Smartphone Sales Dip: Can Foldables Save the Day?

When it comes to buying new smartphones, customer interest is on the decline.

Smartphone shipments declined year over year for the third consecutive quarter amid weak customer demand, according to Counterpoint Research’s Market Monitor data(Opens in a new window).

As a whole, smartphone sales are down 24% over the same quarter last year, with Android devices particularly affected. TCL-Alcatel saw the steepest decline at 69%, while Samsung saw a 37% decline and Motorola dipped 17%.

“Despite inflation numbers falling through the quarter and ongoing strength in the job market, consumers hesitated to upgrade their devices amid market uncertainty. We expect this trend to continue through Q3 2023,” says Research Analyst Matthew Orf.

While it still saw a year-over-year decline, Apple was a bit more resilient than its Android peers and only saw a 6% drop. Still, Apple’s share of the smartphone market increased 10%, and expectations for the upcoming iPhone 15 launch “remain bullish,” Orf says.

Counterpoint suggests customers are hesitant to upgrade their existing devices due to economic uncertainty. It attributes Apple’s success to its prepaid and postpaid promotions. Older-generation iPhones were offered at steep discounts in the prepaid market and AT&T, T-Mobile, and Verizon all offered promotional credits of $800+ on the current iPhone 14.

The group also notes that foldable smartphones are gaining traction. “In spite of declining smartphone shipments, the foldable market reached important milestones in the quarter,” says Senior Research Analyst Maurice Klaehne. “Motorola launched the Razr+, its first foldable device in the US since 2021, and Google launched its first-ever foldable, the Pixel Fold, providing alternatives to the Samsung Galaxy foldables.”

“Foldable shipments could reach their highest level ever in the US in Q3 2023,” Klaehne adds.

Earlier this week, Samsung revealed its Galaxy Z Fold 5 and Z Flip 5, which arrive on Aug 11.