5G Handsets to Make Up 54.1% of Smartphone Unit Volume by 2022: IDC

Global smartphone shipments have trended positively in recent quarters though “the supply chain situation hasn't drastically improved,” reported IDC Monday. It forecast 7.4% shipment growth to 1.37 billion handsets in 2021, followed by 3.4% growth in 2022. Those were slight downgrades from IDC’s May 26 forecasts when it projected 7.7% growth in 2021 to 1.38 billion units and 3.8% growth in 2022.

IDC attributes this year’s anticipated increase to “healthy 13.8% growth from iOS devices combined with 6.2% growth from Android,” it said. COVID-19 “drastically impacted” 2020 shipments, but 2021 shipments have managed “minimal growth” compared with pre-pandemic volumes in 2019, “giving us a more accurate view of the state of the market,” it said.

Shipments in the world's three largest smartphone markets -- China, the U.S. and Western Europe -- will still be down from 2019, but the “growing markets” of India, Japan, the Middle East and Africa “are fueling the recovery,” said IDC. U.S importers sourced 89.23 million smartphones from all countries in 2021's first half, up 17.3% from the same 2020 period but down 9.7% from the 98.89 million handsets shipped here in 2019's first six months, according to Census Bureau data accessed Monday through the International Trade Commission’s DataWeb portal.

The smartphone market “was better prepared from a supply chain perspective heading into 2020 given almost all regions were expecting to grow and vendors were preparing accordingly,” said IDC analyst Ryan Reith, group vice president, IDC's Mobility and Consumer Device Trackers. But the COVID-19 pandemic rendered 2020 shipments “a bust,” though all the top brands “continued forward with their production plans” with delayed timelines, he said.

Industry smartphone levels are “much healthier” than with PCs, and “we are seeing the resilience of consumer demand in recent quarterly results,” said Reith. Vendors and channels continue pushing 5G handsets as a “primary driver” of 2021 growth because they command “significantly higher” average selling prices than older 4G devices, said IDC. It estimates 5G smartphones ASPs will reach $634 in 2021 -- flat compared with $632 in 2020. But 4G device ASPs are down nearly 30% from 2020 to $206.

IDC projects total 5G smartphone volume will grow 123.4% globally this year to 570 million handsets. China will continue to lead the market with 47.1% of the 5G global market share, followed by the U.S. at 16%, India (6.1%) and Japan (4.1%), said IDC. It forecast 5G handsets will be 54.1% of all smartphone shipments by the end of 2022, up from 41.6% this year.