Global Smartphone Shipments Will Rebound in 2019: IDC

After a 3 percent smartphone shipment decline in 2018, the industry is expected to turn a corner and improve in 2019, says the latest IDC report.

smartphones

It's been tougher to sell smartphones around the world over the last few years as markets became saturated and new phone innovations became fewer, but things should improve a bit in 2019 for smartphone vendors, according to a new report by research firm IDC.

Single-digit global smartphone shipment increases are expected in 2019 and through 2022 after shipments for 2018 declined about 3 percent, according to IDC's latest Worldwide Quarterly Mobile Phone Tracker, which was recently released.  

Expectations for 2019 call for a year-over-year 2.6 percent increase in devices shipped, the report noted, following a drop in 2018 to 1.42 billion units from 1.47 billion in 2017. In 2022, smartphone shipments are forecast to reach 1.57 billion units.

Part of the growth in 2019 will come from the China market, which is "finally showing signs of recovery" after a slower 2018, the report continued. In 2017, China represented 30 percent of total global smartphone shipments. For 2018, the China market, which is the world's largest phone market, is forecast to be down by 8.8 percent. In China, IDC anticipates a flat 2019, then back to positive territory through 2022.

The U.S. is also forecast to return to an increase of 2.1 percent year-over-year after experiencing a decline in 2018, the report states.

"The rebound isn't a surprise to us as we have been forecasting a return to worldwide smartphone growth in 2019 for a while now," Ryan Reith, vice president of IDC's Worldwide Mobile Device Trackers, told eWEEK. "We have pushed out the timing of some key regions returning to growth, with China being the largest, but overall it hasn't changed the narrative drastically."

Apple's iPhones won't be driving that growth in 2019, though, according to Reith.

"We expect iPhone volumes to be down 0.7 percent in 2019, following [a drop of] 2.5 percent in 2018," said Reith. "Android, which makes up 85 percent of the world's smartphone volumes, is expected to grow 3.2 percent in 2019." The Android growth in developing markets is mainly driven by lower prices for Android devices compared with Apple handsets, he said. Because Apple devices are more expensive, they have a much lower presence in developing countries.

One reason for 2018 remaining in a downward trend for global smartphone shipments in Q3 has been the slow revival of China's market, said Reith. "This slowdown will persist into Q1 2019 as the market is expected to drop by 3 percent 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."

While the ongoing U.S.-China trade war has the industry on edge, IDC still believes that continued developments from emerging markets, mixed with potential around 5G and new product form factors, will bring the smartphone market back to positive growth.

Although 2018 has fallen below expectations so far, the worldwide smartphone market is set to pick up on the shift toward larger screens and ultra-high-end devices, according to the IDC report. "All the big players have further built out their portfolios with bigger screens and higher-end smartphones, including Apple's new launch in September."

During the third quarter of 2018, IDC saw handsets with 6-inch to 7-inch displays become the most popular devices for the first time, with more than four times year-over-year growth. The company expects that smartphones with screens of more than 5.5 inches will lead the charge with volumes of 947.1 million in 2018, accounting for 66.7 percent of all smartphones, up from 623.3 million units and 42.5 percent share in 2017.

By 2022, shipments of these larger-screen smartphones will reach up to 1.38 billion units, or 87.7 percent of overall shipment volume, according to the report.