Samsung to cut off 30 million phones in production within 2022

Is this a sign of decline?

Samsung Galaxy A52 4G

The COVID-19 pandemic has slowed down production of multiple products around the world, and the most affected ones are smartphones and computers. Several factories have to temporarily close up shop, thus causing a worldwide shortage of chipsets. While the world is on its way to recovery, things have not gone so smoothly, and the recovery is sluggish.

In order to not lose profits, it would be unsurprising to hear that several OEMs will cut down production. Samsung has been said to cut off 30 million phones in its production line within this year, as told by South Korean news outlet Maeli. The article was then translated by the Samsung-centric blog SamMobile.

Of course, it’s not only Samsung that is adapting to this change. Apple has also been reported to cut off production of the iPhone SE by 20%, and other iPhones may follow suit. The on-going war in Ukraine has also been another cited cause for the very slow recovery, as multiple companies banded together to remove their products and services in Russia.

The production cut is reportedly going to affect midrangers and budget phones. This means phones in the A and M series. Instead of 310 million units as originally planned, Samsung is now going to manufacture only 280 million units in these segments.

As people started to upgrade their phones less and less due to rising inflation, smartphone sales started to slow-down. Phones nowadays have become stagnant in terms of innovations or upgrades that a phone you bought a few months ago is still as relevant as phones announced today.

Source: SamMobile, TechCrunch