Smartphone market forecast to climb out of its two-year slump in 2024

That will bring total shipments up to 1.24 billion units, according IDC’s Worldwide Quarterly Mobile Phone Tracker, following two years of ‘steep declines.’

Pent-up demand for device upgrades is given as one driver for the forecasted growth, alongside ‘pivotal’ Android growth of an expected 7.6% YoY focused in APeJC, Latin America, Middle East and Africa and China, primarily in low end devices.

Apple iOS devices on the other hand are expected to grow a more modest 0.4% in 2024 despite ‘record breaking’ performance in emerging markets like India. IDC attributes this to Apple facing challenges in large markets like China, US and Europe.

However that’s all expected to flip in 2025, when IDC expects iOS sales to grow by 3.1% YoY, outpacing Android’s forecasted 1.7% growth over the same period.

While the 2024 predictions represent a ‘strong rebound’, growth is expected to slow to low single digits from 2025 onward, with a 2.6% CAGR (2023-2028). IDC cites reasons for this as increasing smartphone penetration, lengthening refresh cycles, and ‘headwinds’ from a rapidly growing used smartphone market.

"While GenAI continues to be a hot topic and top priority for many vendors, it is yet to impact demand significantly and drive early upgrades." said Nabila Popal of IDC. "While we continue to believe GenAI will revolutionize the user experience in the years to come, more investments are needed to increase consumer awareness and introduce a ‘must have’ feature that will rush consumers to the store and create that super cycle which everyone is waiting for. For now, we expect GenAI smartphones will take their place in premium flagship devices and keep moving down in price tiers to rapidly grow to 70% of the smartphone market by 2028.”

"New foldable phone models continue to grab headlines despite the low volumes in the market," said Anthony Scarsella of IDC. "In Q3, foldables declined by 7.4%, even as most of the world’s prominent vendors launched new models. Still foldables will grow 10.5% in 2024 and maintain a double digit growth through 2028 with a five-year CAGR of 15.9%. However, the pace of growth is slowing down as Chinese vendors (who are driving this segment) are realigning focus and investments towards GenAI smartphones. Durability concerns and lack of unique use cases are also dampening growth."

Speaking of Chinese vendors, yesterday Huawei launched the Huawei Mate 70 series, presumably just to its domestic market. The translated release document puts a lot of emphasis on its AI functionality and satellite connectivity, and according to SCMP much was made of the HarmonyOS Next operating system at the launch. This in-house Huawei operating system is an alternative Android which Huawei has been forced to abandon due to US trade restrictions.  

Radio Free Mobile in its analysis said: “It has always been Huawei’s idea to roll HarmonyOS across all of its ecosystems, and this has largely been accomplished in its low-end smartphones, smart TVs, routers, watches, and tablets. However, the migration of its flagship lineup, represents a permanent departure from Android finally removing a dependence on software created overseas to stand on its own two feet. Furthermore, Huawei’s flagships have been used as geopolitical ripostes to restrictions placed on China’s technology and are the strongest indication yet of the coming fragmentation of the technology industry.”

As with previous Huawei launches of late, much of the speculation has been to do with the nature of the chips powering its devices, in regards to what level of sophistication the domestic Chinese manufacturing base has been able to generate since being cut off from state-of-the-art silicon from elsewhere due to US sanctions. However, Huawei seems to be remaining tight-lipped on the subject in this case.