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Riding booming demand, foldables to outperform overall smartphones

By FAN FEIFEI | China Daily | Updated: 2024-01-03 09:51
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Vivo's foldable smartphone X Fold+, which features mobile imaging technology co-developed by Zeiss, on display at the fifth China International Import Expo. [Photo provided to chinadaily.com.cn]

The foldable smartphone market is expected to witness robust growth in the coming years, mainly driven by the gradual improvement of flexible screens and hinge-related technologies alongside continuous product price declines, experts said.

They added the burgeoning market is currently the only segment that continues to show an upward trend within the smartphone industry — one which has been mired in sluggish sales of late.

Global shipments of foldable handsets are projected to reach 100 million units in 2027 from 13.1 million units in 2022, with a compound annual growth rate of 51 percent during the period, said a new report released by China Securities.

Shipments of foldable smartphones in China hit 1.26 million units in the second quarter of 2023, surging 173 percent year-on-year, and this figure is likely to surpass 17 million units in full-year 2025, the report said. Currently, the penetration rate of foldable handsets worldwide only stands at 1 percent.

Counterpoint Research said global foldable smartphone shipments are expected to have continued their rising trend and hit 16 million units in 2023, an increase of 26.8 percent year-on-year, fueled by the continued growth of the Chinese foldable phone sector and accelerated competition among foldable products worldwide.

A survey conducted by the consultancy said 64 percent of high-end smartphone users in China are willing to purchase a foldable smartphone for their next purchase, and 89 percent of potential foldable handset buyers prefer book-type foldable designs for their wide and large displays and multitasking features.

The survey added that trying new form factors and owning bigger screens are key reasons driving preference for foldable options, while the durability and longevity of foldable smartphones is the top area where consumers want to see improvements.

The Chinese foldable smartphone market has shown exponential growth in 2023, registering a 106 percent year-on-year increase in the third quarter, said Counterpoint Research.

A string of handset makers, such as Honor, Oppo, Vivo and Samsung Electronics, rolled out their latest foldable smartphone models last year in a bid to grab a bigger slice of the pie in the highly competitive smartphone market.

Huawei Technologies Co has maintained its top position in the domestic foldable smartphone sector with a market share of 34 percent in the third quarter, while Samsung took second place at 21 percent. Honor secured a market share of 16 percent, ranking third, followed by Oppo and Vivo's foldable smartphones, the consultancy said.

"The Chinese foldable smartphone market was poised for double-digit growth in 2023, even against an anticipated overall market contraction of less than 5 percent year-on-year," said Zhang Mengmeng, a senior research analyst at Counterpoint Research.

With original equipment manufacturers (OEMs) enhancing the durability, design and affordability of foldables, these devices are set to captivate a broader consumer base, Zhang said, adding that unique software capabilities like advanced multitasking and seamless inner-outer screen integration are expected to further boost the appeal of foldable smartphones.

Global market researcher International Data Corp said 67.05 million units of smartphones were shipped in China in the third quarter, down 6.3 percent year-on-year. Nevertheless, a sign of the market bottoming out emerged as consumers were attracted by the social buzz led by the Huawei Mate 60 series, while key vendors put more focus and hope on the fourth quarter.

IDC estimates global foldable phone shipments will reach 41.5 million units in 2026, with a compound annual growth rate of 38.7 percent from 2021 to 2026. Although it still believes this use case remains a low priority, falling prices and new business use cases make the idea more appealing moving forward.

Nabila Popal, research director with IDC's worldwide quarterly mobile phone tracker, said foldables remain a niche and premium flagship device, and vendors should focus on improving user experience and boosting confidence in the category to generate long-term growth.

"I believe foldables are the future of premium Android devices even if, as a whole, they are only expected to capture less than 3 percent of global volume by the end of our forecast period," Popal said.

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