The tech sector shock looks set to rumble on as supply chains realign and European companies rethink cloud suppliers
Global smartphone shipments in the first quarter of 2025 grew 3% YoY, according to preliminary data from Counterpoint Research’s Market Monitor service. The global smartphone market, which grew in 2024 after a dip in 2023, started off on a positive note in 2025 as well, driven by growth in markets like China, Latin America and Southeast Asia.
However, the US Administration’s capricious will-they-won’t-they approach to replacing global trade with protectionist tariffs could already be having an effect on the handset market killing off any big recovery. Already, Nvidia has headed off to Beijing as the unintended consequences grow.
“The Q1 growth fell short of our earlier projection of 6% as uncertainty started building up around tariffs towards the end of the quarter and as a cautious inventory buildup was seen at OEMs,” said Counterpoint senior analyst Yang Wang. “Uncertainty still looms in the market, which will affect the situation going forward. As a result, our previous forecast of 4% growth in 2025 seems hard to achieve. We may even see zero to negative growth this year.”
Taiwanese analysts TrendForce revealed today that the implementation of the US “reciprocal tariffs” on 9 April – followed by a 90-day grace period for most regions – has prompted semiconductor memory chip buyers and suppliers to adjust their strategies in response to policy uncertainty. Senior research vice president Avril Wu noted that with both sides rushing to complete transactions and shipments within the grace period to mitigate future policy risks, memory market activity is expected to pick up notably in 2Q25.
She said the grace period has temporarily eased concerns about demand loss due to new tariff barriers. However, lingering uncertainty over the direction of US trade policy has driven memory buyers to adopt a more defensive stance—actively raising DRAM and NAND Flash inventory levels as a buffer against supply risk.
Wu concluded that ultimately, the future course of US tariffs will be the key factor shaping memory supply-demand dynamics and pricing trends in the second half of the year. Needless to say, anyone in the tech industry could substitute the word memory with whatever flavour of tech the US policies will impact this year.
Clouds on the horizon
In the latest FAFO news, OVHcloud CEO Benjamin Revcolevschi said, in a quarterly earnings statement: “In the current geopolitical context, we are seeing a shift in the concerns of private companies and public organisations in Europe. Questions of strategic autonomy are now on CEOs’ agendas.”
He added: “The choice of a cloud provider is no longer just a technical matter, but also a strategic issue.” The sentiment will no doubt be noticed by the three US-based hyperscalers: Amazon Web Services (AWS), Microsoft Azure and Google Cloud, which dominate the market. OVHcloud competitor Iliad, via its subsidiary OpCore that operates the group’s 13 data centres, is set to invest €3 billion in AI infrastructure and data centres. With OVHcloud pointing out the obvious, the next phase in Europe’s data centre investments may involve a dose of schadenfreude-as-a-service.
Back at the global handset market
Outside the whacky world of tariffs, Counterpoint said the global smartphone market’s shipments grew 3% YoY during Q1 2025, driven by growth in markets like China, Latin America and Southeast Asia. Samsung secured first place, beating Apple by a narrow margin. Unsurprisingly, Huawei was the fastest-growing brand due to its strong growth in the Chinese market.
Based on preliminary data, Xiaomi continued its momentum and held on to its third place with 2% YoY growth. This performance largely came from a strong comeback in its home market China, supported by the brand’s retail and portfolio expansion. OPPO and vivo captured fourth and fifth positions respectively, separated by a narrow margin. Both brands gained from their strong performance in the mid-tier price band and from government subsidies in China.
