After two years of struggles, the smartphone market is forecast to grow 5.8% year-over-year in 2024 to reach 1.23 billion units, according to new research from International Data Corp (IDC).
The growth is triggered by a hefty increase in the first quarter of 12%, followed by 9% growth in the second quarter. This first half growth will continue optimism into the second half of the year, IDC said.
One of the main reasons for growth is that Android smartphones continue to grow in emerging markets after two years of declining growth. Additionally, new premium phones are hot due to emerging GenAI smartphones.
"The improved forecast for 2024 cements the road to recovery for the smartphone market, driven by stronger growth for Android devices in China and emerging markets," said Nabila Popal, senior research director with IDC's Worldwide Quarterly Mobile Phone Tracker. "The resulting growth for Android this year will be nine times faster at 7.1% than iOS at 0.8%. Apple's softer growth is a result of increasing competition in China but also a higher comparison base year.”
GenAI – The next big thing
Popal said that upside for iOS devices may be possible depending on how well GenAI use cases play out in the upcoming launch of the iPhone 16 and how soon Apple may be able to establish local partnerships with AI vendors in China. IDC said it forecasts an improved 2025 for iOS devices with 4% year-over-year growth due to Apple Intelligence, Apple’s AI platform.
"Although GenAI smartphones are relatively new in the market, premium flagships will continue to adopt GenAI features to help separate them from the pack," said Anthony Scarsella, research director with IDC's Worldwide Quarterly Mobile Phone Tracker. "IDC expects a robust 344% growth for GenAI smartphones capturing 18% share of the total market by end of 2024, as most flagships will adopt some on-device GenAI features.”
The downside is these GenAI smartphones won’t be cheap with average selling prices expected to be more than double the cost of non-GenAI capable devices, which will cement them in the premium range and initially only early adopters will likely be using.
