Smartphone production around the world took a hit due to the COVID-19 pandemic followed by a debilitating global semiconductor shortage. But a new report from a market research firm shows that production could rebound as soon as 2022. Thanks to the usual smartphone replacement cycle and increased demand from developing markets, the smartphone industry is expected to see a production increase to 1.39 billion units, with 5G smartphones making up close to half of the market share as companies adapt to the challenges posed by the pandemic.

According to the report published by TrendForce, smartphone production is set to touch pre-pandemic levels in 2022 with a year-on-year growth of 3.8 percent. Among the predictions made for the coming year, the report states that companies are expected to produce around 1.39 billion smartphone units. Out of these 600 million units are expected to be 5G phones, making up 45.7 percent of the smartphone market share, according to the report.

For 2021, the 5G smartphone market share is projected to touch 37.4 percent with around 500 million units produced. However, despite the Chinese government’s efforts to encourage 5G commercialisation, which has resulted in an 80 percent market share in China, the report claims that infrastructure build-out and higher 5G tariffs could show the growth of the global market share in 2022. Manufacturers could also face shortages in sourcing components for 5G smartphones due to limited foundry capacities.

Samsung could produce around 276 million units in 2022, according to the report, which notes that foldable phones like the Galaxy Z Flip 3 and the Galaxy Z Fold 3, and features like the company’s S Pen have helped it maintain its premium-segment market share. However, the company could face competition in developed markets, while demand in emerging markets will continue to focus on entry-level models, the report says.

Apple, on the other hand, is expected to sell around 243 million units with a 5.4 year-over-year growth. The firm says that Apple could release an iPhone SE (2020) successor with a 4.7-inch display, A15 chipset, and support for 5G connectivity in the first quarter. Apple is also expected to release four smartphone models in the second half of 2022, which could see increased price tags due to rising component prices, according to the report.

Trendforce also sees an increase in the market share of Chinese manufacturers like Xiaomi, Oppo, and Vivo. Xiaomi is projected to produce around 220 million units, with a market share of 16 percent, which includes the company’s subsidiaries like Mi, Redmi, POCO, and Black Shark. Meanwhile, Oppo and Vivo could produce around 208 million units and 149 million units respectively, according to the report.