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Although global smartphone sales are set to grow to 1.24 billion units this year, Apple’s (AAPL+0.91%) performance has barely improved, according to a new study.
Apple and its rivals are expected to ship 6.2% more phones in 2024, according to market intelligence firm IDC. But Apple’s iPhone sales are set to grow by just 0.4%, a minor increase compared to its competitors.
The good news for Apple is that the tech giant is still the industry’s profit leader. Apple sells each of its smartphones for about $1,000, while Android rivals collectively sell their phones for about $295, according to the IDC. In October, $46.22 billion of Apple’s overall $94.9 billion in revenue came from iPhone sales, which marked a 6% year-over-year increase.
The IDC said that much of this year’s growth came from pent up demand and regions where smartphones haven’t greatly penetrated the market. While Apple is expected to have a better performance in 2025, more affordable devices from Android sellers helped Chinese brands boost their sales.
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Plus, despite new investments in artificial intelligence by companies like Apple, Google, and Samsung, customers aren’t really interested — not yet.
“While GenAI continues to be a hot topic and top priority for many vendors, it is yet to impact demand significantly and drive early upgrades,” IDC senior researcher Nabila Popal said in a statement.
Popal added that generative AI will “revolutionize the user experience,” noting that more investments are needed to make consumers more aware and interested in such features in order to boost demand and create the “super cycle” the industry is looking for. By 2028, the IDC thinks smartphones using generative AI will grow to 70% of the overall smartphone market.
That somewhat lines up with what Jefferies (JEF-0.05%) analysts warned earlier this month. In a note following Apple’s third-quarter earnings report, Jefferies warned that the iPhone’s sales momentum was likely due to an earlier launch of the iPhone 16 compared to the iPhone 15, noting that AI features likely won’t impact sales for a while.
Apple officially rolled out its new artificial intelligence features, known as Apple Intelligence, for users with the iPhone 15 Pro or iPhone 16 in October. CEO Tim Cook said Apple Intelligence “marks the beginning of a new chapter” for the company’s innovation and that new features, including ChatGPT integration, would begin rolling out in December, with more to come in the future.
That staggered approach will likely start creating a payoff in 2026 or 2027, the Jefferies analysts said at the time, warning that “current expectations for Apple Intelligence to kickstart a super upgrade cycle are too high.”
—Rocio Fabbro contributed to this article.
