Analytics Company: The Smartphone Market Will Shrink by 12.9% This Year Due to Chip Shortage
The smartphone market is expected to decline by 12.9% this year due to a global chip shortage impacting manufacturers and driving up component costs.
A recent report indicates that the global demand for advanced memory for artificial intelligence tasks has significantly reduced the available supply until at least next year. This ongoing chip shortage poses a serious threat to many smartphone manufacturers, forcing them to adapt to increased component costs. With rising expenses, manufacturers are limiting specifications, discontinuing certain models, and encouraging consumers to opt for more premium devices instead.
Nabila Popāla, a senior research director at IDC, highlighted the seismic shifts expected in the smartphone market as a result of the crisis. These changes will likely affect the volume of sales, average selling prices, and overall competition in the industry. The implication is clear: manufacturers must navigate a landscape altered by the ongoing shortage and rising costs, which are expected to persist well into next year.
As the crisis develops, it remains uncertain when the situation for smartphone production and availability will improve. Experts forecast that significant adjustments will continue to reshape the market dynamics, forcing both manufacturers and consumers to reconsider their strategies and preferences. Until mid-next year, the smartphone industry may experience ongoing turbulence that could redefine the market altogether.