Smartphone sales are up in Q1 2025, but not for the reasons you think
This supply-side surge inflated Q1 shipment figures beyond levels anticipated based on underlying consumer demand trends alone.
Smartphone shipments in early 2025 are technically up, but the story behind the numbers is less about consumer demand and more about geopolitics and strategy.
In Q1 2025, global shipments rose a modest 1.5% year-over-year to 304.9 million units, according to IDC, and 1% by Canalys’ estimate. But this growth had less to do with people rushing out to buy new phones and more to do with manufacturers rushing to beat the clock on potential U.S. tariffs on Chinese imports.
As US-China trade tensions flared again and economic uncertainty lingered, smartphone makers front-loaded shipments into the U.S., stockpiling devices in anticipation of higher costs. IDC called it a “supply-side surge” that distorted what real global demand actually looked like. A similar market movement was observed in the PC segment, too.
Emmanuel Oyedeji
A 90-day pause on the proposed tariffs and tariff suspension on electronics gave some breathing room, but the uncertainty hasn’t gone away. Vendors are still scrambling to move fast while they can.
Amid all of this, the U.S. market held up well on the surface. Shipments climbed over 5%, boosted by consumer interest in new premium models and a growing sense of “buy now before it gets more expensive.”
Apple saw its best-ever first quarter for shipments, thanks largely to aggressive stockpiling, not just in the U.S., but globally, as retailers braced for supply chain disruptions. Samsung, meanwhile, took back the top spot worldwide, driven by demand for its AI-powered Galaxy S25 and the more affordable A36 and A56.
Chinese brands saw gains too, but for a different reason. A government-backed subsidy program, expanded at the start of the year to cover smartphones under CNY6,000 (around $820), fueled domestic sales. Xiaomi, Vivo, and OPPO all benefited—Vivo grew 6.3% year-over-year, while OPPO reclaimed fourth place globally, despite slipping in international markets.
But underneath the surface, the momentum was shaky. Canalys pointed to weak sell-through, muted spending, and lacklustre performance even during typically strong shopping periods like Ramadan in Q1. “Cautious consumer sentiment driven by global macroeconomic challenges muted the typical seasonal uplift in Q1,” the firm noted. Now, vendors are pulling back from a volume game and shifting to profitability.
Without that late-quarter shipment push, Q1 might’ve looked much flatter. And with no clarity on what the U.S. will do next on tariffs, companies are hedging their bets. Some are diversifying supply chains and shifting production out of China. Others are simply trying to buy time.
So while the numbers show growth on paper, the reality is more complicated. This wasn’t a rebound, it was a well-timed, defensive play in an industry still on edge.
Emmanuel Oyedeji
