According to IDC, worldwide smartphone shipments are expected to decline by 3% in 2018 before returning to low single-digit growth in 2019 and through 2022. Despite the on-going US-China trade war, IDC says that it believes that continued developments from emerging markets, combined with potential around 5G and new product form factors, will bring the smartphone market back to positive growth.
Smartphone shipments are expected to drop to 1.42 billion units in 2018, down from 1.47 billion in 2017. The YoY growth in shipments will be around 2.6% in 2019. The smartphone shipments are forecast to reach 1.57 billion units in 2022. The China market, which represented 30% of total smartphone shipments in 2017, is finally showing signs of recovery. The U.S. is also forecast to return to positive growth in 2019 after experiencing a decline in 2018.
The slow revival of China was one of the reasons for low growth in Q3 2018 and this slowdown will persist into Q1 2019 as the market is expected to drop by 3% in Q4 2018. Furthermore, the recently lifted U.S. ban on ZTE had an impact on shipments in Q3 2018 and created a sizable gap that is yet to be filled heading into 2019.
Android’s smartphone share will remain stable at 85% throughout the forecast. Shipments are expected to grow at a five-year compound annual growth rate (CAGR) of 1.7% with shipments approaching 1.36 billion in 2022. Android average selling prices (ASPs) are estimated to grow by 9.6% in 2018 to US$258, up from US$235 in 2017.
As for iOS, the smartphones are forecast to drop by 2.5% in 2018 to 210.4 million. The launch of expensive and bigger screen iOS smartphones in Q3 2018 helped Apple to raise its ASP, simultaneously making it somewhat difficult to increase shipments in the current market slump. IDC expects that iPhone shipments will grow at a five-year CAGR of 0.1%, reaching volumes of 217.3 million in 2022.
Sangeetika Srivastava, senior research analyst with IDC’s Worldwide Mobile Device Trackers said:
With many of the large global companies focusing on high-end product launches, hoping to draw in consumers looking to upgrade based on specifications and premium devices, we can expect head-to-head competition within this segment during the holiday quarter and into 2019 to be exceptionally high.