On the back of a slower market recovery than previously expected, market intelligence and advisory services firm International Data Corporation (IDC) has revised its worldwide smartphone forecast for 2023.

Global smartphone shipments for 2023 are now predicted to decline 1.1% to 1.19-billion units amid weak demand and ongoing macroeconomic challenges, down from the previous forecast of 2.8% growth, pushing recovery into 2024.

According to IDC’s latest Worldwide Quarterly Mobile Phone Tracker forecast, real market recovery is not expected to occur until 2024, when IDC expects 5.9% year-over-year growth, followed by low single-digit growth leading to a five-year compound annual growth rate of 2.6%.

“With increasing costs and ongoing challenges in consumer demand, original- equipment manufacturers (OEMs) are quite cautious about 2023. While there is finally some good news coming out of China with the recent reopening, there is still a lot of uncertainty and lack of trust, which results in a cautious outlook,” says IDC Mobility and Consumer Device Trackers research director Nabila Popal.

“However, we remain convinced the global market will return to growth in 2024 once we are past these short-term challenges as there is a significant pent-up refresh cycle in developed markets as well as room for smartphone penetration in emerging markets to fuel stable long-term growth.”

In 2023, fifth-generation will account for 62% of smartphones shipped worldwide, rising to 83% by 2027.

According to the IDC, while the overall market contracts, momentum also continues around foldable phones, with expectations that shipments will surge 50% to nearly 22-million units this year as costs decrease and more OEMs launch foldables, as seen with multiple Android foldable launches at Mobile World Congress early this month.

Meanwhile, the smartphone average selling price that saw rapid growth over the last few years, from $334 in 2019 to $415 in 2022, is expected to start declining in 2023 to reach $376 by the end of the forecast period in 2027.

“2023 is set to be a year of two halves, with the first half piggybacking off the downhill slide from the fourth quarter of 2022,” adds IDC Mobility and Consumer Device Trackers research director Anthony Scarsella.

“Most regions will face double-digit declines in the first half of the year, make a turn into positive territory in the third quarter, and then boost into double-digit growth in the last quarter of the year.”