Global Smartphone Market Contracts 13.9%

The global smartphone market is projected to experience its steepest annual contraction on record, with shipments expected to slump by 13.9% to 1.08 billion units this year, according to Counterpoint Research. This downgrade from an earlier forecast is attributed to a worsening shortage of memory chips, exacerbated by the Iran war. The impact is most severe in lower-end smartphones, as chipmakers prioritize AI-related chips, making budget devices less economical to produce. Global smartphone wholesale prices rose 14% in Q1, while shipments fell 3.1%. Companies like Transsion, Xiaomi, and ERC are forecast to see significant declines in shipments (32%, 28%, and 16-20% respectively). In contrast, the premium segment has shown resilience, with Apple Inc. posting record revenue and Samsung Electronics maintaining steady volumes, both benefiting from more stable chip supply and stronger margins.