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Global smartphone shipments to grow 5.3% in 2021 despite supply chain challenges: IDC

According to the International Data Corporation (IDC) forecast, global smartphone shipments will grow by 5.3 percent by the end of 2021 compared to the same period last year (yoy), despite supply chain problems. In its latest report, the research company predicted that 1.35 billion smartphones will be sold by the end of the year. It also states that as the shortage issue is related to 4G components, 5G smartphones could take center stage with 60% of total global smartphone shipments by the end of 2022.

According to him Worldwide Quarterly Mobile Phone TrackerIDC cut its growth forecast for 2021 and 2022 due to lower-than-expected third-quarter shipments, continuing component shortages and logistics problems. It says the deficit situation will not improve until mid-2022.

IDC says it has cut its forecast for smartphone shipments growth for 2021 from 7.4 percent to 5.3 percent and for 2022 from 3.4 percent to 3.0 percent. Over the long term, IDC projects “a modest but healthy 3.5 percent compound annual growth rate (CAGR) over five years.” The firm says the increase in shipments will be driven by higher demand, lower average selling prices (ASPs) and a continuing shift from phones to smartphones.

“While we expected a slowdown in the third quarter, the market shrank by almost half of the projected rate as supply chain and logistics problems hit every major player in the market,” said Nabila Popal, Research Director at IDC Mobility and Consumer Device Trackers.

In terms of performance across regions for the year, IDC says that single-digit declines are forecast across all regions, with significant declines expected in Asia Pacific (excluding Japan) and China. “On an annualized basis, smartphone shipments in the Asia-Pacific region (excluding Japan) will decline by 9.1 percent and in China by 8.4 percent,” IDC said.

On a positive note, the research firm believes that robust growth in the first half of 2021 across all regions except China will help paint a positive picture of overall growth this year.

For 5G smartphones, Popal said the most affected vendors were those with “a broader portfolio of 4G devices,” while those with more 5G models were comparatively less affected. As mentioned above, according to IDC, this is because supply chain issues are related to 4G components.

“These issues have changed our short-term outlook for Android more than for iOS, which is now mostly 5G,” Popal added.

He also said that this lack of 4G components, which may not become the norm until mid-2022, will accelerate the transition to 5G technology. IDC predicts ASP for 4G and 5G phones will decline until 2025.

“As in our previous forecast, 2021 will represent a peak average selling price as Android will hit $ 265 (roughly Rs 19,900) by the end of the year and iOS will climb to a staggering $ 950 (roughly Rs 71,300). Going forward, however, prices in the market as a whole will slowly fall as the number of 5G devices falls by 14.5 percent in 2022 and the number of 4G devices will fall by more than 18 percent next year as the market continues to shift towards 5G. ” said Anthony Scarsella, director of research at IDC. Mobile device trackers around the world.

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