Cheap Android smartphones have brought the market back to growth while Apple is marking time

According to IDC estimates, after a two-year decline, the global smartphone market has begun to recover. Global smartphone sales will grow by 6.2% to 1.24 billion units by the end of 2024, mainly driven by low technology penetration countries where demand for low-cost Android devices has increased.

Image Source: Apple

Sales of Android smartphones are expected to grow 7.6% year-on-year this year, driven by demand for affordable models in Asia-Pacific, Latin America, the Middle East and Africa and China, primarily for low-end devices. In contrast, iPhone growth in 2024 will be a modest 0.4%. Despite record performance in emerging markets such as India, Apple is facing challenges in larger markets such as China, the US and Europe. Still, the average cost of Apple devices exceeds $1,000, which emphasizes the company’s focus on the premium segment of the market. For comparison, Android devices cost an average of $295.

As IDC analysts emphasize, the recovery of the smartphone market in 2024 was primarily due to pent-up demand that accumulated over the years of the pandemic. The biggest beneficiaries of this are Chinese brands such as Huawei and Xiaomi, which are aggressively promoting affordable devices in emerging markets. In addition, Huawei this year released its flagship Pura 70 smartphones to the international market, equipped with a chip of its own production, which was an important step in the fight against American sanctions. In turn, Xiaomi plans to release its own semiconductors by 2025.

Integrating generative AI has become an important focus for companies such as Apple, Samsung and Google. However, according to Nabila Popal, research director at IDC, these technologies are not yet having a significant impact on demand. “While AI remains a hot topic and a top priority for many manufacturers, its impact on demand remains negligible and is not driving early device upgrades. Additional investment is needed to increase consumer awareness and create a must-have feature that will make shoppers flock to stores, triggering that super-cycle of updates that everyone is waiting for,” says Popal. Therefore, today manufacturers need to not only improve technologies, but also actively inform users about their benefits.

Global smartphone shipments will recover in 2024, ending a two-year decline. Image source: Bloomberg, IDC

In China, where competition between brands remains extremely intense, companies have launched large promotions to stimulate demand. Such promotions in 2024 turned out to be much more successful than in the previous year. However, economic instability in the country continues to cause concern. Globally, smartphone shipments remain below pre-pandemic levels, with growth expected to be limited to single-digit percentages in the coming years, according to IDC. This is due to market saturation, an increase in the service life of smartphones and the active development of the secondary market.