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Samsung cuts 2022 smartphone sales target due to inflation

Samsung has reportedly slashed its 2022 smartphone sales target by ten percent. The South Korean firm is now aiming to sell around 270 million smartphones this year. It had initially set a goal of 300 million units.

According to Korean media, this adjustment is due to the global inflation crisis following the Russian-Ukrainian war. Rising prices could reduce demand for smartphones in 2022 and manufacturers are reworking their strategies accordingly. Apple also reportedly cut production of its low-cost iPhone SE by 20% in the second quarter of the year. It could also make similar production adjustments in the coming months. Perhaps the entire smartphone market will see a drop in shipments in 2022.

The new report suggests that Samsung’s smartphone production cut for the rest of 2022 will be global and not just in a specific market segment. This will proportionally reduce the production of economy, mid-range and flagship models, including foldable models.

Speaking of foldables, Samsung was hoping to double shipment of “unconventional” smartphones this year. The company sold a total of 7.1 million foldable devices in 2021, so its target for 2022 is over 14 million units, which would represent around 5% of the company’s total expected smartphone shipments for the year, and 1% of the global smartphone market. . But the current situation may make it difficult to achieve the goal.

However, Samsung remains bullish on the foldable smartphone market. It reportedly nearly doubled parts orders for the Galaxy Z Fold 4 and Galaxy Z Flip 4 compared to their predecessors last year. Key components of the new foldables are currently in mass production, Korean media recently reported. The devices themselves will go into production next month, or July at the latest.

Samsung is still monitoring the situation

The smartphone industry has had a tough few years. The coronavirus pandemic has affected everyone around the world in 2020. As the pandemic eased somewhat in 2021, an unprecedented shortage of semiconductors has 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 first quarter 2022 earnings report, Samsung predicted growth in the smartphone market in the second half of this year after a slow second quarter. But as the situation has not improved since then. Given this, the company has now lowered its sales target for the year. It would be the fifth year in a row that Samsung has failed to sell more than 300 million smartphones. It last surpassed that figure in 2017.

“It is difficult to take an official position,” said a Samsung official regarding the ongoing situations in the world (translated from Korean with Google Translate). “We are monitoring the market situation.”