5G and new iPhones to drive smartphone shipments in Q1 2021

5G and new iPhones to drive smartphone shipments in Q1 2021

According to the latest International Data Corporation (IDC) study, after making a rebound in Q4 of 2020, global smartphone shipments are projected to grow 13.9% year-on-year in the first quarter. This increase is mainly caused by a sustained recovery in demand and supply of 5G-enabled devices. After a contraction of nearly 6% in 2020, this year is forecast to see an increase of 5.5%. The study’s findings show an accelerated growth in online channels, whose share rose to 27% in 2020 from 20% the year before. Over the 2020-2025 period, the smartphone market is expected to deliver a compound annual growth rate (CAGR) of 3.6%.

The two largest geographical markets for smartphone shipments, China and the US, are projected to grow by 5% and 3.5%, respectively. This progress is mainly driven by 5G developments and positive customer response to the recently launched iPhone models. The outbreak of the COVID-19 pandemic caused a decline of 10-11% for both markets last year. Now, despite a number of city-level lockdowns introduced in China back in January, the outlook for that market remains stable.

5G continues to be the main driving force in the industry, further accelerated by the successful launch of Apple’s 5G iPhone 12 lineup. According to IDC, 5G smartphone shipments are expected to account for more than 40% of global shipments this year, with this number projected to reach 69% in 2025.

The success of 5G-capable devices, in particular the iPhone range, has increased IDC’s estimate for overall average selling price (ASP) of smartphones for 2020 from $349 to $363. However, increasing competition in the 5G Android space, mostly from Chinese vendors, will likely drive prices down to $404 by the end of the forecast period in 2025.

Source: Telecom Paper

Maciej Biegajewski

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