In a significant revision, Counterpoint Research has slashed its global smartphone shipment growth forecast for 2025 to just 1.9% year-on-year, down from its earlier estimate of 4.2%. This downgrade reflects deepening trade tensions, softening consumer demand, and price pressures in key global markets like North America, Europe, and China.

Demand Weakness and Trade Tensions Take Centre Stage

According to Counterpoint’s Market Outlook Smartphone Shipment Forecast Report, several factors have contributed to this downward revision. The most notable among them are:

• Renewed uncertainty over US trade tariffs, particularly affecting brands like Apple and Samsung.

• Weakened demand across mature smartphone markets like North America and parts of Asia.

• A potential rise in smartphone prices due to cost pass-throughs from tariffs.

These challenges are making it difficult for smartphone manufacturers to maintain previous shipment expectations, especially in premium and mid-range segments that dominate developed economies.

Emerging Markets Still Offer Growth Opportunities

Despite the muted global forecast, regions such as India, Southeast Asia, and parts of Africa are expected to continue posting growth. These emerging markets benefit from:

• Higher replacement cycles due to increased smartphone adoption.

• Lower exposure to geopolitical risks such as US-China trade tensions.

• Increasing consumer appetite for feature-rich smartphones under budget and mid-range categories.

This growth will likely be led by value brands and refurbished device sales, as more users upgrade from feature phones.

Apple Expected to Buck the Trend in 2025

One of the few bright spots in Counterpoint’s revised outlook is Apple, which is expected to register positive shipment growth in 2025. This is attributed to:

• Strong early demand for the iPhone 16 series.

• Premiumisation trends in India, Southeast Asia, and the GCC countries.

• Apple’s focus on ecosystem stickiness, helping retain and convert users across multiple devices.

Apple’s strategy to localise production in India is also paying dividends, allowing the tech giant to cater to local demand more efficiently while navigating geopolitical hurdles.

Huawei’s Comeback: A Surprise in the Making

Another player to watch in 2025 is Huawei, which is staging a potential comeback by leveraging:

• Easing supply chain bottlenecks, especially for semiconductors and critical components.

• A renewed push in mid-to-low-end smartphone segments within China.

• Gradual preparations for a global push, especially in developing markets.

According to Ethan Qi, Associate Director at Counterpoint, Huawei may not witness a breakout year globally in 2025, but it is laying the groundwork for a stronger international presence through incremental gains in supply chain resilience.

Samsung Faces Crosswinds from Multiple Fronts

While Samsung remains a dominant player, the Korean giant may face pressure from both premium rivals like Apple and budget segment challengers like Xiaomi and Transsion. Its exposure to the US market and high reliance on global trade makes it vulnerable to:

• Sudden tariff changes under Section 301 and related trade laws.

• Shifting consumer loyalty in price-sensitive markets.

• Competition in foldable and high-end segments, where differentiation is narrowing.

Samsung’s flagship strategies will need recalibration in light of new entrants and evolving consumer preferences.

Android 16 Launch and Its Market Influence

On the software front, the launch of Android 16 is expected to bring significant upgrades, including:

• Improved privacy controls

• AI-powered performance enhancements

• Customisation features for user experience

• Cross-device ecosystem integration

These upgrades could encourage higher upgrade rates in Android ecosystems, potentially boosting shipments for Android-based OEMs, though cost-sensitive consumers may delay adoption.

Tariffs and Pricing Strategy Still in Flux

One of the biggest concerns for the smartphone industry going into 2025 is pricing uncertainty due to:

• Unpredictable tariff changes, especially involving China, the US, and Europe.

• Rising component costs and disruptions in the logistics chain.

• Currency fluctuations in emerging markets.

Counterpoint's report notes that while its forecast assumes a relatively stable policy environment, any escalation in trade tensions could result in further downgrades. Brands may be forced to rethink pricing strategies, absorb costs, or pass them on to consumers—each scenario with its own risks.

Industry Players Brace for Fluid Market Conditions

The fluid nature of global trade policies and shifting consumer sentiment make 2025 a critical year for strategic agility in the smartphone sector. Manufacturers will need to focus on:

• Supply chain localisation and diversification

• Strengthening software and service ecosystems

• Targeted marketing in growth geographies

• Product differentiation through innovation and affordability

Long-Term Outlook Hinges on Policy Stability

In conclusion, while the global smartphone shipment growth for 2025 has been cut sharply, it is not all gloom for the sector. Opportunities abound in the premium segment, led by Apple, and in emerging markets, driven by mid-range innovation and increased smartphone adoption.

However, the trajectory of this recovery and expansion is highly dependent on geopolitical stability, tariff frameworks, and the pace of digital transformation globally.

The Upcoming IPOs in this week and coming weeks are Jainik Power Cables, Sacheerome Limited, Victory Electric Vehicles International, Wagons Learning.

The Current active IPO are Ganga Bath Fittings.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.