Secondhand and premium markets drive smartphone shipments down

Given the global economy, the smartphone market has declined for several quarters. Despite signs of recovery, Counterpoint and Canalys reports suggest the trend is continuing. According to reports, buyers are still seeking cheaper options in the refurbished market or from companies discounting older models to clear stock.

According to Counterpoint, the smartphone market fell 8% year-over-year for the eighth straight quarter. Canalys reported an 11% drop in Q2 2023, continuing a six-quarter decline.

Samsung led due to Galaxy A sales. Apple had the largest Q2 market share ever, according to Counterpoint, despite finishing second. Xiaomi, Oppo, and Vivo were third, fourth, and fifth. Canalys and Counterpoint reported similar market shares for these phone makers.

The premium phone market, which includes devices with $600+ wholesale prices, also grew, according to Counterpoint. For the first time, premium phones shipped over 20%. Apple had a good quarter with most devices priced above $600. Counterpoint reported a 50% year-on-year growth in India, which could become the fifth largest iPhone market.

Earlier this year, a report found that the refurbished phone market grew 16% year-over-year. This means consumers prefer to buy used devices at a lower price than new ones.

Both reports use jargon to indicate recovery, but the main point is that manufacturers are discounting and selling their old device stock. New model demand could boost market recovery.

Canalys says phone makers are marketing its upcoming launches more. OPPO, Vivo, Transsion, and Xiaomi are pushing their sub-$200 models through retail channels, which could boost growth in India.

Analysts gave no timeline for market recovery. However, smartphone companies are buying components in bulk to combat price increases and inflation.