Smartphones are now a vital aspect of daily life, and envisioning a world without them seems nearly impossible. However, projections for 2025 indicate that the growth of smartphone sales could face significant challenges, primarily due to tariffs.

Counterpoint Research initially estimated that smartphone shipments would grow by 4.2% year-over-year in 2025. However, those figures have since been revised downward to a more modest growth rate of 1.9%.

The primary factor behind this adjustment is the impact of tariffs. A breakdown of regional markets reveals that North America may experience negative growth of about 3%, while markets in Europe, India, the Middle East, and CALA are expected to remain in the positive range, although the North American decline is concerning.

The tariffs, instituted under former President Trump, affect goods imported into the United States, leading to varied tariff rates based on a smartphone’s country of origin. If manufacturers do not absorb these additional costs, price increases are likely, causing consumers to hesitate in upgrading their devices—an understandable reaction given the economic implications.

According to Liz Lee, Associate Director at Counterpoint Research, significant attention is focused on major players like Apple and Samsung due to their substantial presence in the U.S. market. The concerns surrounding tariffs are compounded by a general decline in demand, not just in North America but also across parts of Europe and Asia.

This situation has been echoed by earlier IDC reports, which offer a more conservative growth forecast of 0.6%. As for the potential price hikes, it remains uncertain how Severely tariffs will affect consumer costs.

In the early stages of the tariff discussion, some analysts warned of extreme scenarios, including smartphones reaching prices as high as $3,500. In response, companies like Apple have begun stockpiling inventory to mitigate the impact of these changes should they materialize.