Why Apple's Smartphone Shipments Are Set To Grow At More Than Double The Pace Of Rivals In 2021

Apple Inc's AAPL 5G-enabled iPhone lineup and the ongoing recovery in the overall smartphone market is likely fueling a strong growth rate for the tech giant.

Apple Leads Industry: Apple's smartphone shipments are expected to grow at a 13.8% rate in 2021, according to a new report released by the IDC. This is faster than the estimated 7.4% growth rate for the overall market and way ahead of the 6.2% growth forecast for Android-based smartphones.

Apple launched its iPhone 12 iteration, comprising four models, in late 2020 in a staggered manner. The company benefited from a massive upgrade cycle, as about 350 million of the 950 million iPhones worldwide were in the window of an upgrade opportunity, Wedbush analyst Daniel Ives said.

The iPhone 12 represented the most significant product cycle for the company since the iPhone 6 in 2014, he added.

Related Link: Why Apple Is A 'Top Tech Name' To Own Right Now

Overall Market Recovers: Global smartphone shipments are likely to hit 1.37 billion units in 2021, IDC estimates. The performance, though it pales against the pre-pandemic numbers, suggests recovery from the pandemic-induced volumes in 2020, the market research group said.

The growth in 2021 is expected to be led by emerging markets such as India, Japan, the Middle East and Africa. On the other hand, the world's largest smartphone markets such as China, U.S. and Western Europe are likely to see volume declines compared to pre-pandemic levels.

"2020 was a bust due to the pandemic but all of the top brands continued forward with their production plans with the main difference that the timeline was pushed out. Therefore, we are at a point where inventory levels are much healthier than PCs and some other adjacent markets and we are seeing the resilience of consumer demand in recent quarterly results," said Ryan Reith, group vice president with IDC's Mobility and Consumer Device Trackers.

The primary driver of the estimated growth in 2021 is 5G, with vendors and channels focusing on 5G devices that carry a significantly higher average selling price than older 4G devices. IDC estimates ASPs of 5G smartphones to grow from $632 in 2020 to $634 in 2021.

The firm forecasts 3.4% growth each in 2022 and 2023.

Photo: Courtesy Apple