This revised outlook, published by Counterpoint Research, results from issues over U.S. tariff policies and the ripple effects they’re having on manufacturers, supply chains, and consumers.

The earlier forecast stood at 4.2%, but with Washington’s trade stance remaining uncertain and a recent announcement from President Trump introducing new tariffs on key imports, that rate has evaporated. 

Although the U.S. has temporarily suspended tariffs on smartphones and other tech products, the damage is already visible in market sentiment.

I see what’s happening: manufacturers are on edge. Apple and Samsung, two of the biggest names in the smartphones market, are scaling back the expected volume of shipments.

This is not about supply alone, but cost too. With prices rising along the supply chain, manufacturers are passing the burden onto consumers. People are thinking twice before upgrading their devices. That hesitation hurts the entire industry.

Counterpoint also noted that China, the world’s largest smartphone market, is not immune. Year-on-year shipment growth there is expected to flatten. That’s no surprise when you consider the stress from economic fluctuations, weak consumer confidence, and worsening geopolitical tensions.

In contrast, Apple is slowly untangling itself from China. Around 20% of iPhones imported into the U.S. now originate from India. This change is a necessary buffer against the instability of U.S.-China trade relations.

International Data Corporation (IDC) has already lowered its growth projection for 2025 from 2.3% to a meagre 0.6%. According to IDC, “tariff-driven economic uncertainty and a pullback in consumer spending” are the key forces dragging the market down.

These revised numbers on smartphone shipments suggest supply chains in flux, global inflation biting into purchasing power, and a tense political climate that makes long-term planning difficult for tech giants.

If these warnings hold, 2025 won’t be the recovery year the smartphone industry had hoped for. Instead, we may be entering a phase where resilience, not growth, becomes the central strategy.

According to data from Counterpoint Research, the company had a 19% market share, driven by the successful launch of the iPhone 16e. This model, replacing the iPhone SE, starts at $599 and has aligned particularly well in markets like Japan and India. 

However, while global sales for the smartphone industry grew by 3% year-over-year in Q1, there are signs that the market could face a decline for the rest of the year. 

This is largely due to economic instability and shifting trade policies, particularly those linked to tariffs imposed by the United States. “As per our current estimates, the tariff announcement did not lead to a major demand increase because of the uncertainty around tariffs and policy. Since tariffs were announced in April, it did not impact iPhone demand in Q1 2025,” said Ankit Malhotra, senior research analyst at Counterpoint.

Despite these economic issues, other companies in the smartphone market are holding their ground. Samsung, with its 18% market share, followed closely behind Apple, thanks to the launch of its new S25 series and refreshed A-series devices in March. 

Xiaomi also performed well, capturing 14% of the market as it continued to expand into new regions, particularly in China, and strengthened its brand presence with its move into the electric vehicle sector.

While Apple saw relatively flat or declining sales in traditional markets like the U.S., Europe, and China, it grew across emerging regions. The Middle East, Africa, and Southeast Asia were all marked by double-digit growth, contributing to Apple’s global success.

Again, the global smartphone market faces a tricky year ahead. Counterpoint Research has adjusted its forecast, now predicting a slight decline in the overall market, driven by economic uncertainties and fluctuating tariff policies. 

Emerging technologies, including generative AI and foldable devices, are expected to continue to gain traction. However, manufacturers will need to remain vigilant, closely monitoring demand and adjusting their strategies to avoid overproduction.