Samsung has reportedly reduced its smartphone sales target for 2022 by ten percent. The South Korean firm is now aiming to sell around 270 million smartphones this year. It had initially set a target of 300 million units.
According to the Korean media, this adjustment is due to the worldwide inflation crisis following the Russia-Ukraine war. Increasing prices may reduce demand for smartphones in 2022 and manufacturers are reworking their strategies accordingly. Apple also reportedly cut the production of its low-cost iPhone SE by 20 percent in the second quarter of the year. It may make similar production adjustments in the coming months as well. Perhaps the whole smartphone market is will see a decline in shipment in 2022.
The new report suggests that Samsung’s smartphone production cut for the rest of 2022 will be across the board and not just a specific market segment. It will proportionally reduce the production of budget, mid-range, and flagship models, including foldables.
Speaking of foldables, Samsung was hoping to double the shipment of the “unconventional” smartphones this year. The company sold a total of 7.1 million foldable devices in 2021. So its target for 2022 is more than 14 million units, which would be about five percent of the company’s total projected smartphone shipments for the year, and one percent of the global smartphone market. But the ongoing situation may make it difficult to achieve the target.
Samsung is still optimistic about the foldable smartphone market, though. It has reportedly almost doubled the part orders for the Galaxy Z Fold 4 and Galaxy Z Flip 4 as compared to their predecessors last year. The key components for the new foldables are currently in mass production, Korean media recently reported. The devices themselves will enter production next month, or latest by July.
Samsung is still monitoring the situation
The smartphone industry has had a difficult couple of difficult years. The coronavirus pandemic affected everyone globally in 2020. While the pandemic somewhat subsided in 2021, an unprecedented semiconductor shortage rocked the tech world. Things were expected to improve this year, only for Russia to start a war in Ukraine, causing global inflation.
In its Q1 2022 earnings report, Samsung forecasted the smartphone market to grow in the second half of this year after a slow Q2. But as the situation has not improved since then. Given this, the company has now reduced its sales target for the year. This would be the fifth straight year that Samsung has failed to sell more than 300 million smartphones in. It last topped that figure in 2017.
“It is difficult to make an official position,” a Samsung official said regarding the ongoing situations around the world (translated from Korean with Google translate). “We are monitoring the market situation.”