US Smartphone Shipments See 24% Decline in Q2 2023, According to Analysts

Smartphone shipments in the US have experienced a significant decline of 24% in the second quarter of 2023 compared to the same period last year, a global analyst firm reported.

According to Counterpoint Research's Market Monitor data, this marks the third consecutive quarter of year-on-year declines in smartphone shipments within the US market.

Android Brands Take the Hardest Hit

Notably, Android brands, including Samsung, Motorola, and TCL-Alcatel, were among the hardest hit, witnessing substantial drops in shipments. In contrast, Apple's shipments demonstrated more resilience, increasing the company's share of shipments compared to the previous year.

Research Analyst Matthew Orf commented on the decline in smartphone shipments during Q2 2023. He attributed the drop in sales to the summer slump and market uncertainty.

Despite favorable inflation numbers and a strong job market, he said consumers hesitated to upgrade their devices during this period. However, analysts expect the outlook to change in Q3 2023 due to the anticipation surrounding the upcoming iPhone 15.

While overall smartphone shipments faced a decline, specific segments of the US market showed promising signs of life. The foldable market, in particular, reached significant milestones during the quarter.

Motorola introduced the Razr+, its first foldable device in the US since 2021, while Google ventured into the foldable space with its inaugural device, the Pixel Fold.

These alternatives to Samsung's Galaxy foldable phones could drive foldable shipments to new heights in the US during Q3 2023, especially with Samsung releasing new Galaxy Z Flip and Z Fold devices, according to Senior Research Analyst Maurice Klaehne.

Apple Sees Rise in Shipments

Despite observing fewer shipments from Apple compared to the previous year, the brand's share of shipments still rose by 10% year-on-year. Apple's resilience can be attributed to robust promotions offered by major carriers such as Verizon, AT&T, and T-Mobile.

These carriers continued to offer enticing credits for iPhone 14 purchases, and older-generation iPhones saw substantial discounts, particularly in the prepaid segment, as Associate Research Director Hanish Bhatia noted.

Promotional activity across carriers remained robust, with Verizon offering impressive trade-in credits of up to $1,100 for the Pixel Fold. Google's Pixel devices also experienced growth, with the old-generation Pixel 6a entering the prepaid channel to compete with the iPhone 11, further enhancing the competitive landscape in the market.

Regarding carrier performance, AT&T and T-Mobile reported positive net additions, while Verizon saw negative net adds within its consumer segment for the second consecutive quarter.

Although net-add activity remained comparable to the previous year, lower upgrade rates contributed to an overall weakness in demand.

"Near-record low churn has also had a dampening effect on new device sales. Weakness is likely to continue through the start of Q3 2023, but stronger iPhone 15 demand could offset weakness across Android," said Jeff Fieldhack, Director of North America Research.