Smartphone replacement cycles have stretched to a record 40 months in key developed markets. Despite heavy marketing around dedicated Neural Processing Units, consumer demand for hardware upgrades remains subdued.
Utility Gap in Mobile AI
On-device AI capabilities—such as photo editing and offline translation—are viewed by consumers as incremental upgrades rather than essential features. Cloud-assisted processing continues to handle complex tasks, diminishing local silicon differentiation.
Secondary Market Pressures
High trade-in values and durable hardware builds support a thriving refurbished market. Refurbished smartphone sales grew 8% year-over-year, siphoning off new device volume across mid-tier price bands.