•    Bangladesh’s smartphone shipments are expected to decline 2% YoY in 2024, the third consecutive year to see a decline.
•    Previous forecasts saw double-digit growth in 2024, but floods and political instability led to market disruptions, causing this downward revision.
•    However, the market is expected to rebound next year with double-digit growth triggered by the feature phone-to-smartphone transition, easing economic pressures, rising local currency value, and digitalization.

Bangladesh’s smartphone shipments are expected to decline 2% YoY in 2024 to record their third consecutive year of decline, according to the latest research from Counterpoint’s Bangladesh Market Outlook. The market had seen signs of shipment recovery during H1 2024, thanks to festive sales. However, anti-government protests and floods suppressed smartphone sales in Q3 2024.

In the first half of 2024, the feature phone-to-smartphone transition picked up pace supported by festive discounts and offers and the country’s economic growth. At the same time, the reduced inflationary pressures led to a rise in the country’s currency value, which in turn reduced the smartphone component cost by up to 10%. However, the nationwide internet shutdown caused by the imposition of a curfew in July 2024 and floods that hit the country’s eastern parts in August 2024 adversely affected smartphone shipments during the third quarter.

To compound matters, the rise in the US dollar’s value against the local currency led to difficulties in opening letters of credit (LCs). On the other hand, persistent inflation forced consumers to reduce spending even more, especially on smartphones during the September quarter. Most consumers opted to stick to their old mobile phones while some chose refurbished or affordable grey market phones. Despite the significant setback, the smartphone OEMs and manufacturers managed to show a partial recovery in September 2024.

Outlook
Bangladesh has an installed base of nearly 63 million smartphones, which is expected to reach 64 million by the end of 2024, mainly driven by first-time smartphone buyers and smartphones emerging as a hub for digitalization. The smartphone is crucial for Bangladesh's digital advancement. The vision of a ‘Smart Bangladesh’ can be achieved through enhanced digital services. High-speed networks, e-commerce and adoption of digital services will drive the smartphone market's growth in 2025.

The shipments of 5G smartphones tripled QoQ in Q2 2024 and are expected to reach nearly 1 million units by the end of 2024. The newly launched vivo V30 and HONOR 90 Smart models captured over one-third of the 5G smartphone shipments in Q2 2024. Demand for faster and more reliable mobile connectivity, the availability of affordable 5G smartphones and the desire for improved mobile internet performance will help grow the 5G smartphone market in Bangladesh.

Despite the expected decline in 2024, Bangladesh’s smartphone market is projected to witness an annual growth of 15% in 2025. This growth will be due to the easing of the country’s economic pressures, a high potential installed base, a significant shift from feature phones to smartphones, first-time user adoption, new use cases, localization of component manufacturing, and ongoing digitalization.