Smartphone Market

Smartphone Market Size & Growth (2021 – 2026)

The global smartphone market was valued at USD 378.29 billion in 2020 and is anticipated to reach USD 493.13 billion by 2026, with a CAGR of 6.85% during the conjecture period 2022 - 2027.

Smartphones, with robust hardware capabilities, extended mobile operating systems, facilitating broader software applications, the Internet and multimedia functions (music, videos, and games), as well as basic phone functions such as voice calls and text messages are included in the scope. Smartphones used for industrial purposes or rugged phones are not included in the scope.

With more than 50% penetration across all regions, the replacement cycle is expanding, leading to lower unit sales, especially in areas like the United States and China, among others.

However, 5G phones and foldable phones are likely to present them with new opportunities. According to Ericsson, the number of 5G mobile subscriptions in North America will reach 325 million compared to 3 million in 2019.

While the increasing adoption of artificial intelligence in smartphones will offer immense growth opportunities, the growing cycle of smartphone replacement will challenge the growth of market players. To take full advantage of opportunities, market sellers must focus more on growth prospects in fast-growing segments, while maintaining their positions in slow-growth segments.

Recent Developments

• In August 2020, Xiaomi introduced a new variant, namely Redmi 9 Prime. The phone is available in market with features like a 6.53-inch touchscreen, 1080 pixels by 2340 pixels resolution at 394 pixels per inch (PPI).
• In July 2020, Samsung Electronics launched its the Galaxy Z Flip 5G, which is the first device in Samsung's Galaxy line that comes with a Qualcomm® Snapdragon™ 865 and 5G platform. This new platform maximizes the power of 5G with improved performance to deliver faster and more efficient on-device processing with sharper images through improved graphical rendering.

Impact of Covid-19 on Smartphone Market

However, due to the COVID-19 outbreak, smartphone shipments have seen a declining phase as countries continue to face the pandemic. According to a report, there is a 15.7% year-on-year decrease in unit shipments from 331.8 million in the second quarter of 2019 to 279.7 million in the second quarter of 2020. The demand is likely to resume to its previous stage post recovery of coronavirus pandemic.

Market Growth and Trends

Online smartphone sales may be challenged by offline push in future

• Smartphones are becoming an important part of retail sales as they become more and more part of consumers' lives. E-commerce websites like Amazon are attracting users with various deals and discounts on smartphones, which improved the culture of online shopping. Online smartphone sales have also been boosted by the holiday shopping culture in all regions.
• However, in regions like India where smartphone sales do not appear to be declining, smartphone companies such as Xiaomi, Samsung, Vivo and Oppo are aggressively expanding their offline stores in the Indian smartphone market to take advantage of the market opportunity.
• Furthermore, participation could be lost to other categories such as fashion and consumer goods, home products, among others, in regions with high penetration of smartphones. This takes into account the growing share of e-commerce and the changing attitude of consumers towards online shopping.

Market Drivers and Restraints

Smartphones are the most common electronic devices nowadays because of a change in people's lifestyles where having a smartphone has become a norm. The increase in disposable income increases the likelihood that consumers will spend on mobile media, entertainment, networks and communications; leading to increased sales potential for consumer electronics such as smartphones, tablets, laptops and game consoles. The cases of smartphone adoption are very high among the urban population compared to the rural population and therefore there is a high demand for smartphones in developed regions (where the proportion of urban and rural population is higher than in developing regions).

SMARTPHONE MARKET REPORT COVERAGE:

Smartphone Market Segmentation

The global smartphone market is segmented on the basis of operating system and distribution channel.

Smartphone Market By Operating System:

the iOS segment is expected to grow at a high CAGR of 7.4% over the forecast period with a relatively high value share. The Android segment is likely to develop with a market share of 46.1% and a CAGR of 6.7%. Android OS is determined to develop as the largest market contributor by 2025.

Smartphone Market By Distribution Channel:

 the OEM segment is foreseen to garner the highest value of almost 36.7% in terms of revenue by 2025 with an annual growth of 8% over the outlook period. The e-commerce segment is likely to account record the highest CAGRs of 7.8% and 9.3% in terms of volume and value, respectively, during the forecast period.

Regional Analysis

China has been a most preferred area for several technology company. Leading supplier Huawei Technologies Co., Ltd., shipped 55.8 million units in the second quarter of 2020 and overtook Samsung, which shipped 54.3 million units in the second quarter of 2020 despite government sanctions. Entering its second year in the United States of America, Huawei can curb the impacts on its international business to compete with Samsung to obtain the top spot in world.

Key Market Players

The major players presented in the global smartphones market report are:

1. Samsung Electronics Co. Ltd.
2. Apple Inc.
3. Huawei Technologies Co. Ltd.
4. Lenovo Group Limited
5. LG Electronics Inc.
6. TCL Communication Technology Holdings Limited
7. ZTE Corporation
8. Vivo Communication Technology. Co. Ltd.