After two consecutive years of decline, the global smartphone market staged an impressive comeback in 2024, marking a turning point for the industry. This remarkable 2024 smartphone market recovery, characterized by a 6.4% annual growth and total shipments of 1.24 billion units, highlights the sector’s ability to adapt and thrive despite challenging circumstances. It underscores the resilience of smartphone manufacturers and their capacity to address macroeconomic pressures like inflation, forex challenges in emerging markets, and shifting consumer priorities, paving the way for renewed growth and innovation.

Commenting on market dynamics, Research Director Tarun Pathak said,

“2024 was a year of recovery and normalization after a difficult 2023. Smartphones continue to be an essential product, pivotal to people’s daily lives, and as macroeconomic pressures softened, the market started showing signs of recovery from Q4 2023 and has now grown for five consecutive quarters. Almost all markets showed growth, led by Europe, China and Latin America.”

The Numbers Behind the Growth

According to Counterpoint Research, the market’s turnaround was driven by strategic adjustments by vendors and increasing demand in both premium and low-end segments. Meanwhile, IDC’s Worldwide Quarterly Mobile Phone Tracker reported a 2.4% year-over-year growth in Q4 2024, with shipments reaching 331.7 million units. This marked the sixth consecutive quarter of growth, setting a strong foundation for continued, albeit slower, expansion in 2025.

Factors Driving Recovery

1. Aggressive Vendor Strategies:
   • Vendors leaned heavily into trade-in offers, interest-free financing plans, and segmented launches to address diverse consumer needs. These tactics not only bolstered sales in developed markets but also unlocked potential in emerging regions like India and parts of Africa.
   • Promotions and discounts were particularly effective in driving premiumization, with many consumers opting for high-end devices at reduced costs. This trend was especially notable in China, where premium smartphones gained significant traction.
2. Regional Dynamics:
   • China and other Asian markets emerged as key growth engines, with Chinese manufacturers accounting for 56% of global shipments in Q4 2024. This historic milestone highlighted the strength of brands like Xiaomi, OPPO, and Vivo in the low- to mid-range segments, as well as Huawei’s dominance in the high-end market.
   • In Europe and Africa, these manufacturers continued to expand aggressively, leveraging their affordable price points and increasing consumer trust.
3. Market Share Shifts:

• • Apple and Samsung maintained their leading positions but faced slight declines in both shipments and market share. Apple recorded a 4.1% YoY decline in Q4 shipments, while Samsung’s dropped by 2.7%.
  • Xiaomi, however, stood out with remarkable growth, securing third place globally and achieving a 15.4% YoY increase in annual shipments. This growth can be attributed to its competitive pricing, strong presence in emerging markets, and expanded portfolio of 5G-enabled devices.
  • Other notable players included Transsion, OPPO, and Vivo, which competed fiercely in both quarterly and annual market share rankings, reflecting an increasingly dynamic competitive landscape.

“The strong growth witnessed in 2024 proves the resilience of the smartphone market as it occurred despite lingering macro challenges, forex concerns in emerging markets, ongoing inflation, and lukewarm demand,” said Nabila Popal, senior research director for Worldwide Client Devices, IDC. “Vendors successfully adjusted their strategies to drive growth by focusing on promotions, launching devices in multiple price segments, interest-free financing plans, and aggressive trade-ins—fueling premiumization and boosting low-end devices—especially in China and emerging markets. While we remain optimistic about continued growth in 2025, the threat of new and increased tariffs from the new US administration has elevated uncertainty across the industry, driving some players to seek preventative measures to mitigate risks; however, thus far, the impact has been minimal.”

Shifting Consumer Trends

• Foldables Losing Steam: Despite heavy marketing efforts, foldable smartphones saw declining demand in 2024. IDC reports that vendors have begun reallocating resources away from foldables to focus on other innovations.
• AI-Powered Features: AI advancements have taken center stage, particularly in premium devices. Generative AI (GenAI) capabilities are becoming a major differentiator, enhancing user experiences in areas like photography, language translation, and app recommendations.
• Diverse Price Segments: Vendors are targeting a wider audience by launching devices across multiple price ranges. This strategy not only addresses varying consumer budgets but also drives market penetration in less saturated regions.
• Premiumization: While smartphone volumes are unlikely to reach the peak levels seen in pre-COVID times, premiumization means that revenues will continue to rise as average selling prices grow. Sales of ultra-premium smartphones, those priced above $1000, grew fastest in 2024 as consumers showed a preference for spending more on their next smartphone. This was enabled by device subsidies in developed markets and the easy availability of low-cost finance in emerging markets. In 2025, we expect revenue growth to continue to outpace volume growth, with revenues growing 8% YoY, compared to 4% volume growth.

Challenges and Outlook

While the 2024 recovery has been robust, the industry faces new uncertainties:

• The possibility of increased tariffs under the new US administration has prompted some vendors to explore preventative measures, though the impact remains limited for now.
• Lingering economic concerns and inflation could slow growth in 2025 as the market stabilizes and pent-up demand is fulfilled.

Despite these challenges, the global smartphone market is poised for continued innovation. AI integration, combined with a balanced focus on premium and budget segments, positions the industry for another year of transformation in 2025.

A Competitive Landscape

The competitive dynamics of the market continue to evolve:

• Chinese manufacturers have not only solidified their dominance in low- and mid-range devices but are also expanding their global footprint. Xiaomi, OPPO, and Vivo are now formidable competitors to traditional leaders like Apple and Samsung.
• Huawei, despite international restrictions, has maintained a stronghold in the premium segment, particularly in its home market of China.

Final thoughts about the 2024 smartphone market recovery

The 2024 smartphone market recovery is a testament to the sector’s adaptability and consumer resilience. With vendors embracing innovative strategies and catering to diverse needs, the industry is set to thrive. As we look ahead to 2025, the focus on AI, premiumization, and expanding market reach will likely shape the next wave of growth. For consumers and stakeholders alike, the future of smartphones promises to be both dynamic and exciting.

What trends do you think will shape the smartphone market in 2025?