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IDC Slashes Smartphone Forecast as Tariff Uncertainty Hits Demand

Roberto Mongillo by Roberto Mongillo
May 29, 2025
in Business
IDC Slashes Smartphone Forecast as Tariff Uncertainty Hits Demand

International Data Corp predicts smartphone shipments will expand only 0.6% during 2025 instead of the initially forecasted 2.6% growth because consumer confidence has weakened alongside trade tensions that affect market demand.

International Data Corp points to unstable U.S.-China relations and rising tariff threats as primary factors which contributed to this diminished forecast. The upcoming year will likely cause significant damage to Apple’s iPhone sales due to IDC’s projected 1.9% decline.

Senior research director Nabila Popal from IDC stated that economic uncertainty triggered by tariffs has created substantial barriers to consumer spending throughout developed markets.

IDC projects the smartphone market will experience minimal growth at 1.4% compound annually from 2024 to 2029 because consumers replace phones less often while the market becomes saturated and people choose to buy pre-owned devices.

The Chinese smartphone market shows a 3% growth projection for 2025 because the government supports Android device sales with subsidies. Apple faces a decline in its market performance due to missing out on Chinese government incentives alongside increasing competition from local competitor Huawei.

Apple works to expand its supply network because it aims to decrease its exposure to Chinese trade restrictions. The expansion of Apple’s production operations in India and Vietnam serves as an important risk-reducing factor according to market analysts. The introduction of new U.S. tariffs introduces additional difficulties into the situation.

The recent proposal from President Donald Trump to impose 25% tariffs on iPhones manufactured outside of the United States could fundamentally transform Apple’s pricing and sourcing methods.

Popal stated that smartphone imports to the U.S. market would face serious market risks if they became subject to 20-30% additional tariffs.

Analysts believe that upcoming events such as China’s 618 shopping festival together with the iPhone 17 launch featuring major hardware improvements will provide some market relief. The market shows indications of a weak performance throughout the upcoming period because of political tensions that surround the industry.

The deepening trade tensions force smartphone manufacturers to face a challenging situation where they need to preserve their competitive pricing while rebuilding their supply chains in ways that will affect the industry throughout multiple years.

Tags: IDC
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