Global smartphone market faces record annual decline as chip crunch worsens

BEIJING: The global smartphone market is heading for its steepest annual contraction on record, with shipments projected to slump by 13.9% this year to 1.08 billion units, Counterpoint Research said on Monday, citing a worsening shortage of memory chips. The forecast is a downgrade from the ‌12.4% decline ⁠projected in February, ⁠with the squeeze in global chip supply exacerbated by the Iran war.

The impact is being felt most acutely in lower-end smartphones as chipmakers shift production capacity to AI-related chips, making entry-level devices less economical to produce.