Global Smartphone Shipments to Feature Generative AI: Chinese Brands Poised for Action

Global Smartphone Shipments to Feature Generative AI: Chinese Brands Poised for ActionA recent report by Counterpoint Research predicts that approximately one-third, or 400 million, of global smartphones will be equipped with Generative AI (GenAI) capabilities by 2025, a significant increase from one-fifth in 2024. This projection highlights the rapid growth of GenAI in the smartphone sector and the intensifying competition among manufacturers

Global Smartphone Shipments to Feature Generative AI: Chinese Brands Poised for Action

A recent report by Counterpoint Research predicts that approximately one-third, or 400 million, of global smartphones will be equipped with Generative AI (GenAI) capabilities by 2025, a significant increase from one-fifth in 2024. This projection highlights the rapid growth of GenAI in the smartphone sector and the intensifying competition among manufacturers.

Counterpoint Research attributes this rapid advancement to progress in chip technology and the proliferation of lightweight Large Language Models (LLMs). Smartphone manufacturers are actively incorporating GenAI features into mid-range models, accelerating broader adoption. This strategy aims to expand GenAI's reach and offer AI-powered experiences to a wider consumer base. However, the report acknowledges that consumer enthusiasm for GenAI applications remains limited. Many consumers question the practical utility and value of these features, highlighting the need for manufacturers to develop more useful AI applications to stimulate upgrades. In short, the technology is ready, but market education and application development remain key challenges.

Apple and Samsung, leveraging their dominance in the high-end market and established ecosystems, are leading the charge, integrating GenAI features into their flagship models with "Apple Intelligence" and "Galaxy AI" respectively. Their strong brand recognition and technological prowess enable more effective promotion and consumer adoption. They can better understand user needs and integrate GenAI features seamlessly with their existing ecosystems, creating a more compelling user experience.

In contrast, Chinese smartphone brands like Xiaomi, OPPO, vivo, and Honor are adopting a more cautious approach. They plan to introduce GenAI features into mid-range models between 2026 and 2027, aiming for wider market penetration through more affordable pricing. This strategy challenges Apple's high-end dominance and showcases the flexibility and market acumen of Chinese manufacturers, prioritizing mid-range market consolidation before expanding into the high-end segment, a stark contrast to Apple and Samsung's strategy.

Counterpoint Research also forecasts "Agentic AI" as the next buzzword in the smartphone industry by 2025. Unlike current GenAI assistants, Agentic AI aims to provide a more autonomous, context-aware, and action-oriented AI experience. This advanced AI technology will proactively offer services and assistance based on user needs and environment, rather than simply responding to commands. Agentic AI is expected to become a key differentiator in high-end models, enhancing user experience and driving further innovation. This suggests that future smartphone AI capabilities will go beyond simple voice assistants or image recognition, offering deeper understanding of user needs and providing more personalized and intelligent services.

This report outlines the future of GenAI in smartphones and highlights differing manufacturer strategies. Apple and Samsung focus on the high-end market and ecosystem integration, while Chinese brands opt for a cost-effective approach to expand GenAI's reach through the mid-range segment. This differentiated competitive landscape will fuel GenAI innovation and offer consumers more choices and enriched smartphone experiences. The future application of GenAI will extend beyond smartphones to various electronic products and services, enhancing convenience and intelligence in daily life.

In conclusion, the application of GenAI in smartphones holds immense potential but faces significant challenges. Meeting consumer needs and developing practical AI applications are crucial for smartphone manufacturers. Future competition will transcend hardware specifications and pricing, focusing on AI innovation and enhanced user experience. The competition between Apple, Samsung, and Chinese brands will accelerate GenAI development, leading to smarter and more convenient mobile experiences. The emergence of Agentic AI signifies a new era in smartphone AI, promising revolutionary changes. Technological advancements and market demands will jointly shape the future trajectory of GenAI in the smartphone sector. This competition is not just about market share but also about the future form and function of smartphones. Manufacturers must continuously innovate to meet and even lead burgeoning consumer demands to thrive in this technological wave.