The once booming smartphone market has long since become a saturated market. Around 1.17 billion smartphones were sold worldwide in 2023, compared to 1.21 billion in 2022. This means that sales have fallen by 3.2 %.
This trend can be clearly seen in Figure 1, which shows global smartphone sales in millions of units from Q1 2020 to Q1 2024. In a long-term view over ten years(Fig. 2), the current global market leader Samsung is clearly in the lead with 2.9 billion smartphones shipped. Apple has caught up significantly in recent years and is in second place with 2.2 billion smartphones. Chinese manufacturers occupy places 3 - 6 in the global ranking. Xiaomi with 1.2 billion and Huawei with 1.1 billion phones are the frontrunners, followed by OPPO with 912 million and VIVO with 527 million phones shipped in ten years. The Chinese consumer electronics group BBK Electronics is behind OPPO and VIVO.
Fig 1: Smartphone sales (in million units) 2020 to 2024 (data: IDC)
Fig 2: Smartphone shipments over 10 years (1st Q.2014 vs 1st Q.2024) in millions of units (data: Canalsys)
Samsung has Apple breathing down its neck
If we compare the sales figures of Apple and Korea's Samsung, Apple is closing in on the global market leader(Fig. 3). Apple even overtook its rival in Q4 2023.
According to the International Data Corporation, there is also only a small gap in global market share in Q1 2024: Samsung 20.8% - Apple 17.3% - Xiaomi 14.1% - Transsion [*] 9.9% - OPPO 8.7% - Others 29.3%.
Fig 3: Apple vs Samsung (2014 - 2023) in million units (data: IDC)
Samsung fights back with 3 nm processor
The Exynos 2200 chip is installed in the current Samsung Galaxy S22 / S22+ / S22 Ultra / S23 FE smartphones. This is manufactured using the 4 nm EUV process. Samsung Electronics is set to launch the new GALAXY S25 with an advanced 3NM EXYNOS 2500 CHIP in January 2025. Through Samsung Foundry's collaboration with Synopsis, this processor is manufactured using the latest second-generation 3nm process and promises remarkable efficiency gains. The Exynos 2500 features a gate all-around transistor (GAA) structure, making it a top-of-the-line processor performance model. The integration of the Exynos 2500 chip underscores the importance of advanced chip technology in smartphones.
The Apple supply chain by country
The analysis of Apple's supply chains in Figure 4 continues to show a heavy reliance on suppliers from China and Hong Kong, with over 50. Taiwan, the USA and Japan are also an important part of Apple's supply chain with over 40 suppliers and the latter two with over 30 each. However, the plan to have 25% of smartphones produced in India in the future shows the company's efforts to diversify regionally.
Fig 4: Apple's supply chain Number of suppliers by headquarters location (Data: IDC)
In a nutshell
- The once booming smartphone market is languishing at 1.2 billion handsets sold.
- Samsung and Apple lead the way with a global market share of 20.8% and 17.3% respectively at the start of 2024, but their Chinese rivals Xiaomi, VIVO, Huawei and OPPO are catching up.
- Thanks to the cooperation between Samsung Foundry and Synopsis, the 3NM EXYNOS 2500 CHIP is expected to give the S25 Galaxy a market advantage in early 2025.
- Apple's dependence on China and Hong Kong with over 50 suppliers remains high.
The market for smartphones is currently relatively saturated with around 1.2 billion units sold per year. Here, the further use of AI could generate new incentives to buy, as is already the case with the top smartphones. ChatGPT has been available to download on IOS since May 18, 2023.
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Hans-Joachim Friedrichkeit
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[*] Transsion Holding is a cell phone manufacturer founded by George Zhu in 2006 and based in Shenzhen.
