Smartphone shipments are on the rise
Smartphone shipments in the fourth quarter surpassed expectations, and IDC predicts that the positive trend will persist into 2024 with continued recovery.
Smartphone shipments exceeded expectations in the fourth quarter of 2023, signaling a positive trend for the industry. International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker reports a 7.3% increase in global smartphone shipments compared to the same period last year. Notably, iPhones outperformed other devices, and the adoption of 5G technology is expected to further boost sales.
Despite an overall decline in 2023, with a 3.5% drop in shipments to 1.16 billion devices, the market outlook is more optimistic than previously predicted. IDC anticipates a continued recovery in 2024, projecting a 3.4% growth in smartphone shipments.
Apple’s resilience during economic challenges is attributed to its more affluent consumer base and strategies like massive trade-ins and financing, focusing on premium products. In contrast, Android players, predominantly in low-end segments, face challenges due to their reliance on emerging markets and China, which were significantly impacted during the crisis.
Price Trends: Smartphone Costs on the Rise, but a Slowdown Looms
In 2023, the average smartphone price is expected to increase by 5.5% to $438, continuing a four-year trend. However, the price hike is projected to slow down, potentially dropping to $396 by 2027, although it remains higher than previous forecasts.
Analyzing smartphone systems, iOS has shown slight growth of 0.6% despite challenging market conditions, reaching its highest market share ever at 19.6%. Meanwhile, Android phones are expected to experience a 4.4% decline. Over the forecast period, Android is expected to surpass iOS, holding approximately 81.3% of the market.
While Android remains the global leader, the iPhone maintains a strong presence in the US market, often setting the standard for comparison when new flagship Android phones are released.
China is witnessing a recovery in tech market interest, with a particular focus on Huawei’s comeback. The Chinese tech giant reported a significant increase in net profit in the September quarter, driven by the success of its Mate 60 Pro smartphone series.
Despite a lackluster year for sales, the rise of 5G technology stands out as a positive highlight. Global shipments of 5G smartphones are expected to increase by 11% in 2023 and 20% in 2024. The proportion of 5G smartphones in the market is set to climb from 61% in 2023 to 83% by 2027. While the overall smartphone market is projected to grow modestly at 1.4% annually from 2022 to 2027, 5G phone shipments are expected to grow at a much stronger rate of 11.1% during the same period.
The widespread adoption of 5G is attributed to market pressure, with new iPhones driving the trend. While users may not notice a significant speed difference in regular phone activities, the impact is more pronounced in activities like tethering, where 5G connections provide a faster and more reliable experience.