Android Smartphone Demand May 'Fall Short' Of Expectations, Affordable Phones Worst Affected: Ming-Chi Kuo

Global demand for smartphones that run on the Android operating system developed by Alphabet Inc.'s GOOG GOOGL Google may not meet projected figures, with a particularly significant impact on mid-range and lower-tier phones, warned tech analyst Ming-Chi Kuo.

What Happened: Kuo, who serves as a tech analyst at TF International Securities, has forecasted that the replenishment of Android smartphone inventory, which began in the third quarter of 2023, is likely to conclude by January 2024 without any major surge in demand to match industry expectations. 

The anticipated shortfall in Android smartphone demand, particularly for mid-range and low-end models, could pose challenges for smartphone manufacturers and suppliers. The analyst has also noted a decrease in order visibility, indicating brands’ caution about future market demand.

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“Inventory replenishment by major Android smartphone brands, which began in 3Q23, is expected to end by January 2024. Given the changes in shipment forecasts and order visibility, the improvement in demand for Android smartphones may fall short of market expectations,” he stated. 

Moreover, as per Kuo’s report, non-Chinese markets have seen order reductions, with local brands in emerging markets experiencing cuts up to 40–50%. The impact on the Chinese market will be determined by sales results in the first three weeks of the Lunar New Year.

The current downturn in demand for Android devices, particularly in non-Chinese markets, could potentially impact the pace of innovation and competition within the smartphone industry.

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