Coming from a report from Bloomberg with Murata Manufacturing, a manufacturing partner for Apple amongst other companies, we’re given a quite bleak outlook for the start of 2023 and perhaps longer…

Murata is (sadly) one major company who can speak on this issue with first hand accounting – they’ve been experiencing a 20% slump in their share price this year alone due to a severe drop in demand in their products. It seems that the President Norio Nakajima’s outlook is that higher-end devices like iPhone 14 Pro are faring much better in sales due to consumers buying a more powerful device and holding onto them for much longer than they have in the past:

“Consumers might have been willing to buy new phones even with small upgrades if the economy were in a better shape,” Nakajima said, pointing to interest rate hikes by central banks around the world as a big factor. “What I’m afraid will happen is smartphones get further commoditized and people will wait even longer before upgrading.”

President Nakajima via Bloomberg

Nakajima’s discussion with Bloomberg didn’t discus any specific brands; however, Nakajima sees a “silver lining” that high-end devices like iPhone 14 Pro and Pro Max are currently succeeding where others are not, and this is backed up by even Apple’s own lower-end iPhones faring poorly vs. their higher-end counterparts. Outlook also remains bleak going into 2023 for a majority of Chinese brands as well:

“The momentum will not come back at least during fiscal 2022 and the situation is not that positive going into the next term,” Nakajima said. “Demand for consumer electronics has dropped drastically and these Chinese makers are not feeling well”

President Nakajima via Bloomberg

Luckily for a company like Apple and hopefully their partners, the global smartphone market could be slumping but numbers show that Apple is coming out on top due to high-end device dominance.

This alls makes sense, especially the President of Murata’s thoughts that consumers are buying the more expensive devices and holding onto them for even longer. This creates larger gaps between upgrades, sure, but when affordable devices are just slightly out of date high-end devices… the best option is clear. We’re going to need more innovative low-end smartphone options to actually get people to buy them.

Source - Frontpagetech | Written by Brian Shoop