- Global smartphone shipments are expected to grow marginally by 0.6% year-over-year in 2025, reaching 1.24b units.
The introduction of new tariff policies by the Trump administration in April has cast a shadow over the global smartphone market, with significant implications for Apple Inc.’s iPhone sales and those of its competitors.
According to the International Data Corporation (IDC), worldwide smartphone shipments are expected to grow marginally by 0.6 per cent year-over-year (YoY) in 2025, reaching 1.24 billion units.
The revised forecast represents a substantial reduction from the previously anticipated 2.3 per cent growth, highlighting the heightened uncertainty fuelled by tariff volatility and broader macroeconomic challenges such as inflation and unemployment, which are collectively dampening consumer spending.
The tempered growth is expected to persist over the coming years, with a modest five-year compound annual growth rate (CAGR) of 1.4 per cent, driven by factors such as increased smartphone penetration, lengthening refresh cycles, and the rise of the used smartphone market.
Two critical markets
The persistent tensions between the US and China, two critical markets in this landscape, underpin the modest 0.6 per cent growth forecast for 2025. China’s market is forecast to expand by 3 per cent YoY, supported by government subsidies that stimulate demand and bolster Android device sales.
In stark contrast, Apple is anticipated to experience a 1.9 per cent decline in the same period, hindered by fierce competition, particularly from Huawei, a broader economic slowdown, and restrictions on eligibility for government subsidies.
Despite these challenges, Apple’s prospects for mitigating the anticipated decline include strategic measures such as offering substantial discounts during prominent shopping events like the 618 festival, and the upcoming launch of the iPhone 17, which is expected to feature notable hardware upgrades.
These initiatives are crucial in sustaining consumer interest and counterbalancing the headwinds posed by the tariff environment and economic uncertainties.
Uncertainty
The US smartphone market presents a nuanced picture. Although forecasted to grow by 1.9 per cent in 2025, its growth trajectory has been curtailed from an earlier estimate of 3.3 per cent, primarily due to the ongoing trade war and the resultant tariff-induced price increases.
However, the unique structure of the US market—with the majority of devices purchased through carriers offering trade-in deals and interest-free financing—has mitigated the immediate impact on consumers. This has allowed premium device sales to remain relatively robust despite a forecasted 4 per cent increase in average selling prices.
The overall uncertainty facing the smartphone industry since April stems from the potential broadening of tariffs, which poses significant risks for long-term strategic planning by original equipment manufacturers (OEMs).
Statements from experts such as Anthony Scarsella and Nabila Popal from IDC underscore the complexity of the current situation, where geopolitical factors intertwine with supply chain diversification efforts.
India and Vietnam emerge as important alternatives to China for production, albeit the threat of additional tariffs ranging between 20-30 per cent on smartphones bound for the US market poses a significant downside risk that could further dampen market prospects.