Preliminary data from International Data Corp. (IDC) estimates that used smartphone shipments will reach 282.6 million units in 2022, an 11.5% increase over the 253.4 million units shipped in 2021.

Trade-in programs continue to be the driving factor for the new and used smartphone market globally. IDC also highlighted the new offerings from vendors that offer trade-ins during new product launches. IDC also attributed the growth to the new market’s rebound of 6.1% in 2021.

This growth is expected to continue as IDC forecasts that used, including refurbished, smartphone shipments will reach 413.3 million units in 2026 with a compound annual growth rate (CAGR) of 10.3% from 2021 to 2026.

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“Used devices demonstrate more resilience to market inhibitors than new smartphone sales as consumer appetite remains elevated in many regions,” said Anthony Scarsella, research manager with IDC’s Worldwide Quarterly Mobile Phone Tracker. “Attractive price points are critical for growth as cost savings remain the primary benefit. However, a high-end inventory struggle due to elongated refresh cycles in the new market has used prices growing over 11% in 2022.”

“In mature markets such as the United States, Canada, and Western Europe, trade-in continues to play a significant role in speeding up refresh cycles through telco and retail-driven promotions,” IDC said. “This has contributed to an increase in trade-in value (TIV), which is typical when demand for new devices is slow. The rise in TIV has pushed prices up in the secondary market due to consumers getting more for their old devices to help drive upgrades.

The increased sale of higher-priced devices in the new market has also created a circular effect as many of these aggressive trade-in deals feature primarily on premium devices. How long these aggressive trade-in offers last remains a big question for buyers and sellers. Eventually, narrow margins will impact the overall profits of the channel, vendor, or perhaps both.