Global smartphone shipments had already begun to contract before 2020, although two years of a pandemic and ensuing supply chain and chip restrictions certainly didn’t help the overall numbers. However, according to a pair of reports from Counterpoint Research and IDC, the market saw growth last year for the first time since 2017.

Counterpoint estimates total annual growth at 4%, with IDC’s slightly more optimistic 5.7%. However, both firms point to a decline for the fourth quarter of 6% and 3.2% respectively. The decline was, of course, to be expected given ongoing chip shortages, which have had an excessive impact on smaller manufacturers with less leverage over the supply chain than companies like Apple and Samsung.

Both firms put Samsung in first place for the year, up 6%, with Apple in second place. The firms also echo a recent Canalys report in which Apple won the quarter. Apple confirmed those sentiments with an excellent quarterly report, fueled not least by the success of the iPhone.

Image Credits: Counterpoint Research

The company’s iPhone division saw revenue growth of 9% year-on-year to $71.63 billion. CEO Tim Cook confirmed supply chain constraints were an ongoing hurdle for the company, with demand outpacing supply in some markets, but added to an appeal that he sees problems beginning to ease and progress. Such problems ultimately point to a market that would otherwise have recovered more vigorously.

“The fact that 2021 would have come out drastically higher had it not been for the supply constraints adds even more positivity to the healthy 5.7% growth we saw for 2021,” IDC research director Nabila Popal said in a release. “To me, it sends the message that there is significant pent-up demand in almost all regions. Even in China, where there are challenges around the weakening consumer demand, the fourth quarter market performed much better than expected, 5% better to be exact, albeit still a year-on-year decline.”

Image Credits: IDC

While China continues to be hit hard by supply chain constraints, the No. 2 and No. 3 smartphone markets saw growth in 2021.

“Growth in the US was largely driven by demand for Apple’s first 5G-enabled iPhone 12 series that trickled through to the first quarter of 2021; Demand continued throughout the year, ending in a strong fourth quarter driven by Black Friday and holiday season promotions,” said Counterpoint analyst Harmeet Singh Walia. “India also had a good year thanks to higher replacement rates, better availability and more attractive financing options in mid- to high-tier phones.”

After nearly a decade of strong growth, pre-pandemic demand slumped due to delayed upgrade cycles, high prices and market saturation. COVID-19 further fueled the slowdown as consumers were less willing to spend. Those issues were compounded by supply chain issues, although pent-up demand and things like 5G have rekindled interest, though overall shipments still remain below pre-pandemic levels.

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