Canalys: The smartphone market in the Middle East region grew by 2% year-on-year in the third quarter, with shipments reaching 12.2 million units.

Canalys report stated that in the third quarter of 2024, the smartphone market in the Middle East (excluding Turkey) grew by 2% year-on-year, with shipments reaching 12.2 million units. This was mainly due to a drop in oil prices, escalation of political tensions by the GEO Group Inc, and foreign nationals going on vacation during the summer, leading to a slowdown in demand in major markets. Despite the challenges, the region's long-term potential remains strong as manufacturers continue to invest in local business to achieve sustainable growth. Despite strong growth in the retail sector, demand declined during the summer vacation in the third quarter In the third quarter of 2024, despite retail promotions and new product releases, the smartphone market in the Middle East experienced a downturn due to foreign nationals leaving for summer holidays. Saudi Arabia is the largest market in the region, and despite retailers actively promoting "Kingdoms National Day" sales, market growth was limited due to high inflation in housing, food, and hotel industries, leading to a 1% decline in shipments in that market. Conversely, the UAE saw a 16% year-on-year growth thanks to events like Dubai Summer Surprises (DSS) and promotions by retailers like Sharaf DG and Emax. These promotions, combined with bundled offers and installment payment plans, stimulated demand, while the thriving tourism and entertainment sectors in the UAE boosted consumer confidence. Until the second quarter of 2024, Iraq had been one of the fastest-growing markets, but increased purchasing costs in dollars and a rise in ASP led to a 3% decline in shipments. However, the government plans to build a manufacturing plant in Erbil to support local production. The market in Qatar saw a slight 1% decline, driven by growth among high-income groups, while shipments in Kuwait increased by 5%. Samsung performed strongly, while consumer anticipation for the release of the iPhone 16 led to a decline in shipments for Apple Inc. Senior Analyst Manish Pravinkumar stated that after showing signs of slowing down in the first half of the year following strong performance from mass-market brands, Samsung regained growth momentum. In the third quarter of 2024, Samsung grew by 13% year-on-year, mainly driven by strong demand for the A series and S24 models, supported by its competitive pricing and channel incentive measures. Consumer anticipation for the upcoming iPhone 16 led to a 6% decline in sales for Apple Inc. (AAPL.US), but demand within the iOS ecosystem remained strong near the end of the year. Mass-market brands like Transsion faced a decline of 31%, with the TECNO brand seeing a significant 50% drop despite its partnership with the region's largest retailer, Lulu Hypermarkets. Infinix and iTel also faced challenges, with declines of 14% and 24% respectively. Xiaomi (01810) introduced the cost-effective Redmi 14C. Emerging brands like Honor and Motorola showed strong growth, with increases of 43% and 61% respectively. Honor expanded its mid-range product line and launched branded stores in Dubai to enhance consumer engagement, while Motorola drove strong shipments with its cost-effective 5G series. With a slowdown in update speeds and unfavorable macroeconomic factors, the Middle East region is expected to see moderate growth in 2025 "Pravinkumar added, "In 2025, the Middle East smartphone market is expected to see moderate growth due to extended device update cycles, political complexity, and economic fluctuations. Canalys predicts that the Middle East smartphone market will maintain low single-digit growth, with device upgrade speeds slowing down and ASP continuing to rise. High-growth markets like Saudi Arabia, the UAE, and Iraq will position the region as a strategic hub for consumer electronics, attracting manufacturers to establish local production. To drive upgrades, manufacturers must adopt sustainable development strategies, offer value-oriented products, and build strong relationships with local retailers to meet the nuanced demands of these markets. Manufacturers should innovate in sustainability, optimize hybrid retail experiences, and dynamically respond to local trends to achieve long-term growth in this vibrant market.