Global demand for smartphones grew in 2021 despite chip shortage, first increase in three years

Canalys said Singapore's smartphone market last year grew by 2.3 per cent from 2020, with 2.3 million units flying off the shelves. ST PHOTO: KUA CHEE SIONG

SINGAPORE - Demand for smartphones worldwide grew for the first time in three years last year despite the ongoing global chip shortage due to pandemic-caused disruptions.

Vendors shipped 1.35 billion units, a 7 per cent increase from 1.26 billion in 2020, according to the latest annual report by market research firm Canalys.

Demand shot up as people depended on these devices for everything from grocery shopping to remote working amid social isolation measures to curb the spread of the Covid-19 pandemic.

Access to vaccine records has also gone digital, as the authorities around the world battled the use of fake documents when travel started to resume last year.

"Smartphones remain a necessity in today's increasingly digitalised and connected society, even more so in a pandemic-stricken period," said research analyst Chiew Le Xuan.

While smartphone shipment last year is close to the number in 2019, it still falls short of the 1.46 billion in 2017, which was noted by some research firms such as Counterpoint to be the period when worldwide smartphone sales peaked.

After 2017, global shipments have been steadily dropping as fewer people find a need to replace their older handsets and as smartphone makers struggle to find the next big invention.

According to Canalys, global sales for smartphones fell by 4.6 per cent to about 1.39 billion units in 2018, and then by a further two per cent to nearly 1.37 billion units in 2019.

In 2020, 1.26 billion units were shipped amidst the global semiconductor shortage and supply chain disruptions caused by the Covid-19 pandemic.

The firm's findings showed that Samsung was the top vendor worldwide last year, shipping nearly 275 million smartphones, or about 20 per cent share of the total shipments made.

Apple was second with 230 million units, while Xiaomi took third place with 191 million units. Oppo was in fourth position with 145 million units shipped, and Vivo was fifth with about 130 million units.

Canalys told The Straits Times that vendors have attempted to mitigate the impact of the ongoing global chip shortage on their bottom line by raising prices.

The pandemic caused factories to shutter, hampering not just the production of smartphones but also televisions, computers and cars.

A CNBC report in September last year quoted chip firm Advanced Micro Devices' chief executive Lisa Su as saying that the shortage would ease in the second half of this year as supply ramps up.

Car manufacturers including Hyundai Motor and General Motors also shared similar views, Reuters reported last month.

Market research firm Morningstar reportedly said the shortage would eventually lead to an oversupply in 2024, while semiconductor firm Infineon Technologies said the scarcity might stretch to next year.

Canalys said Singapore's smartphone market last year grew by 2.3 per cent from 2020, with 2.3 million units flying off the shelves.

Samsung was also the top vendor here last year with a market share of 35 per cent, ending Apple's six-year streak of being in pole position.

Apple was second last year, followed by Oppo.

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