Canalys: It is expected that the global smartphone market growth will rapidly slow down to 1.5% by 2025.

Canalys expects that the growth of the global smartphone market will rapidly slow down to 1.5% by 2025. Manufacturers still have the opportunity to seek localized growth opportunities. Long-term growth will remain stable, but limited in magnitude, and face various challenges, with no significant surge in shipments. In 2024, the global smartphone market grew by 7.1% to reach 1.23 billion units, exceeding the forecast released earlier in November 2024. Strong demand at the end of the year and smartphone manufacturers actively replenishing inventory were important factors in this growth. In the temporary background of the global macroeconomic and supply chain, the above driving factors can only provide short-term momentum for the market. At the same time, the smartphone market in 2025 will face new challenges such as inventory risks and the peak of replacement demand being over. 2025 will show a cooling trend after a strong recovery In 2024, the global smartphone market grew by 7.1% to reach 1.23 billion units, exceeding the forecast released earlier in November 2024. Strong demand at the end of the year and smartphone manufacturers actively replenishing inventory were important factors in this growth. However, Canalys predicts that market growth is expected to rapidly slow down to 1.5% in 2025. Market performance will vary by region, with some regions reaching a turning point in growth and starting to decline. The core logic of the upcoming slowdown in the market In the temporary background of the global macroeconomic and supply chain, the above driving factors can only provide short-term momentum for the market. At the same time, the smartphone market in 2025 will face several new challenges. Inventory risks: High shipment volume in 2024 and intense competition may lead to a significant increase in inventory in some regions, including emerging markets in the Asia-Pacific, India, and Latin America. Smartphone manufacturers and distributors are focusing on optimizing inventory to achieve sustainable operations. Peak of replacement cycle is over: 2024 saw a significant recovery in demand, marking the first large-scale upgrade and replacement since the economic downturn caused by the pandemic and geopolitical conflicts. However, replacement demand is expected to significantly slow down starting in 2025. Potential market risks that need to be monitored Russia-Ukraine situation In the past one to two years, the initial impact of the war on the global smartphone market has weakened, as disruptions including logistics bottlenecks, global food price hikes and inflation, currency fluctuations, and economic recessions have mostly been absorbed or released. Only specific markets (such as Russia and Ukraine, among others) still face direct challenges, including population outflow, channel restructuring, economic pressure, inflation, and uncertainty in the operating environment. Depending on the current geopolitical situation, the war may end or reach a viable solution in 2025. Canalys outlines the possible short-term outcomes if the war is resolved.