Even with the successive launches of new smartphones in the market, market intelligence firm International Data Corp. sees a 1.9% decline in smartphone shipments in 2023.
Smartphone market recovery is slower than expected and IDC had to adjust its previous forecast from 1.1 billion units or down from the 2.8% growth in the prior forecast.
Real market recovery is not expected to occur until 2024 when IDC expects 5.9% year-over-year growth followed by low single-digit growth leading to a five-year compound annual growth rate (CAGR) of 2.6%.
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“With increasing costs and ongoing challenges in consumer demand, OEMs are quite cautious about 2023,” said Nabila Popal research director with IDC’s Mobility and Consumer Device Trackers. “. While there is finally some good news coming out of China with the recent reopening, there is still a lot of uncertainty and lack of trust, which results in a cautious outlook.”
Devices equipped with 5G technology are expected to contribute to the growth and will account for 62% of smartphones shipped worldwide this year and the recovery will go further to 83% by 2027.
Foldable smartphone shipments are expected to grow to nearly 22 million units this year or a 50% increase while the overall market contracts.
“This segment will continue to grow as costs decrease and more OEMs launch this form factor, as we have seen this week with multiple Android foldable launches at Mobile World Congress,” the IDC said.
Smartphone average selling price (ASP) that saw rapid growth over the last few years (from $334 in 2019 to $415 in 2022) will begin to decline starting in 2023 and is expected to reach $376 by end of the forecast period.
“2023 is set to be a year of two halves with the first half piggybacking off the downhill slide from the fourth quarter of 2022,” said Anthony Scarsella, research director with IDC’s Mobility and Consumer Device Trackers. “Most regions will face double-digit declines in the first half of the year, make a turn into positive territory in the third quarter, and then boost into double-digit growth in the last quarter of the year. We expect the influx of premium flagships that typically launch in the third and fourth quarters will keep the full year decline from being worse.”
Categories: Consumer Tech