According to a report by International Data Corporation (IDC), the worldwide shipments of used smartphones, including officially refurbished and used smartphones, will surpass $109.7 billion in market value and reach 431.1 million units in 2027, with a compound annual growth rate (CAGR) of 8.8 per cent from 2022 to 2027.
As per the report, the supply of used smartphones remains a critical challenge as refresh cycles, high price points, and macroeconomic challenges have all negatively impacted the new smartphone market. However, demand for used smartphones remains healthy and will continue to grow throughout the forecast period, just at a slower rate than previously forecast.
IDC forecasts new smartphone shipments to decline 3.5 per cent in 2023 as demand, inflation, and political unrest continue to impact the global economy. In contrast, the used market demonstrated fierce resilience to overcome these unforeseen circumstances by displaying nearly 10 per cent growth for the year. Refresh rates for new phones in most developed markets have extended past 40 months, which has caused a shortage of available inventory for the secondary market. Trade-in programs continue to fuel the industry but only make up a portion of the total used inventory. Moreover, the lack of inventory has also impacted each region’s total available market for used devices. The total secondary market has been pulled down around 2.7 per cent as longer refresh rates and weak consumer spending continue to dampen both the new and used markets.
Commenting on the report, Anthony Scarsella, research manager, Worldwide Quarterly Mobile Phone Tracker, IDC said, “Despite the near 10 per cent growth, the secondary market is showing signs of slowdown due to a genuine lack of inventory. With refresh rates extending in most mature markets, acquiring inventory remains the biggest challenge for resellers. Secondary phone retailers are hungry for inventory as the high end of the market continues to be scarce due to customers just holding on to their devices. This lengthening can also be witnessed in the new market where shipments declined 3.5 per cent for 2023.”
