According to IDC Research, Apple and its competitors are expected to deliver 6.2% more smartphones by the end of 2024 compared to 2023, totaling approximately 1.24 billion units. However, iPhone sales are projected to rise by only 0.4%.
Apple maintains its position as the leader in profit margins, with an average selling price exceeding $1,000, while Android competitors average around $295.
Despite the excitement surrounding artificial intelligence, the smartphone market has contracted post-pandemic. IDC attributes much of the anticipated growth in 2024 to pent-up demand and markets with lower smartphone penetration. Chinese brands are particularly filling this gap with affordable devices.
Consumer enthusiasm for new AI features from Samsung, Apple, and Google has not materialized as expected. Nabila Popal, Research Director at IDC, noted that while generative AI remains a hot topic, it has yet to significantly impact demand or drive early upgrades. Increased investment is necessary to raise consumer awareness and introduce must-have features that would stimulate sales.
To counter potential challenges in the U.S. market, brands like Xiaomi and Huawei are heavily investing in hardware and developing their own processors and AI technologies. Recently, Huawei unveiled its latest smartphone powered by chips manufactured in China, while Xiaomi is preparing proprietary semiconductors for devices expected to launch in 2025.
Globally, smartphone shipments have yet to return to pre-pandemic levels. IDC forecasts low single-digit growth for the coming years, citing longer upgrade cycles, market saturation in developed countries, and a rapidly growing trade in used smartphones as key factors. China is expected to remain one of the most competitive markets.