May 21, 2024
Business Tech

GenAI Smartphone Shipments To Skyrocket By 2027

Installed Base To Surpass One-billion Mark

A dramatic surge in GenAI smartphone shipments is forecasted, with a fourfold increase by 2027, totalling a staggering 550 million units.

These estimations by Counterpoint Research, detailed in the forthcoming report GenAI Smartphone Shipments and Insights, mark a significant advancement from Counterpoint’s earlier forecasts in December 2023.

The surge is notably fuelled by Apple’s imminent entry into the segment, which is expected to reshape the competitive landscape.

According to Counterpoint’s analysis, GenAI smartphones are poised to capture 11% of the overall smartphone shipments by 2024, climbing to a substantial 43% by 2027.

The GenAI smartphone installed base is forecasted to surpass the one-billion mark by 2027.

Counterpoint’s research defines GenAI smartphones as a new breed of devices that leverage large-scale, pre-trained generative AI models to create original content or perform contextually-aware tasks.

Multimodal Capabilities

These devices are anticipated to possess multimodal capabilities, allowing them to process inputs such as text, image, and voice to generate diverse outputs.

This unique feature promises users a seamless and fluid experience, setting them apart from traditional smartphones.

Tarun Pathak, Research Director at Counterpoint, said: “More than 10 OEMs have launched over 30 GenAI-capable smartphones so far. AI in smartphones has been a critical talking point since the start of this year, especially after the successful debut of the Galaxy S24 series, where Samsung has gained an excellent mind share in marketing early AI use cases.

Skyrocket
Apple’s entry into GenAI smartphones may reshape the competitive landscape. Credit: Daniel Romero

“We expect Samsung to lead GenAI smartphone OEM rankings in 2024. This is the second trend in the past few years where Samsung enjoyed an early-mover advantage, the first being its foldables’ success. The AI advantage will give Samsung momentum in the mid-to-premium smartphone segment as GenAI features are recognised more broadly in coming years.”

‘Use Cases’

Pathak added: “Apart from Samsung, market entry will further help the segment’s growth. Once Apple enters, we expect AI to immediately become a must-have feature in all mid-to-premium smartphone launches starting in 2025. However, the real differentiation will lie in the use cases as consumers are still evaluating the potential impact of AI in their future devices.”

Mohit Agrawal, Associate Director at Counterpoint, said: “Smartphones of the future will be more personalised to cater to individual needs and preferences, and AI will play a central role in driving these personalised experiences.

“As OEMs differentiate themselves on AI positioning, the key here will be the evolution of AI use cases. These use cases include enhanced imaging capabilities, translation features, improved app experiences, content recommendations, personalised content creation, and more. These use cases will evolve as the large language models (LLMs) grow in size and efficiency.

‘Mainstream Model’

“Counterpoint believes that the integration of edge (mobile devices) and cloud will be the mainstream model for generative AI in smartphones, and OEMs with an equally strong play in software capabilities, along with strategic industry partnerships, are likely to stay ahead of the competition.”

“In the future, we expect GenAI smartphones to hit an inflexion point in 2025 as the devices permeate the broader price segments, especially the $400-$599 price tier. The ≥$600 and $400-$599 price bands will account for nine of every 10 GenAI smartphones sold in 2024.

“Leading chipset companies like MediaTek and Qualcomm have already taken the lead in embracing generative AI smartphones. They have launched several mobile computing platforms that support multimodal large AI models on devices. We expect Qualcomm to lead in the AI SoC space in 2024, capturing almost half of all GenAI smartphone shipments, followed by MediaTek with a 13% share,” Agrawal concluded.

With the stage set for exponential growth, the smartphone landscape is poised for a transformative shift driven by the proliferation of GenAI technology and its myriad applications.

Featured image: The GenAI smartphone installed base is expected to surpass the one-billion mark by 2027. Credit: Paul Hanaoka

    Arnold Pinto

    Arnold Pinto

    Arnold Pinto is an award-winning journalist with wide-ranging Middle East and Asia experience in the tech, aerospace, defence, luxury watchmaking, business, automotive, and fashion verticals. He is passionate about conserving endangered native wildlife globally. Arnold enjoys 4x4 off-roading, camping and exploring global destinations off the beaten track.
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