Data from market analysts indicates a significant shift in the US smartphone market, with consumers holding onto devices longer and creating a shortage of newer, high-quality phones available for certified resale. This trend is driven by economic pressures, extended carrier financing plans, and a resulting influx of older, lower-grade devices into the secondary market.

Industry data from IT analysts Circana and wholesale platform B-Stock shows the average smartphone replacement cycle is stretching. Most devices now entering resale channels are at least three generations old. Affordability concerns and payment terms extending to 36 months have altered consumer upgrade behavior. Concurrently, the proportion of D- and E-grade devices has reached record levels, signaling a decline in the average quality of traded-in handsets.

Growth of the Pre-Owned Market

Approximately 11 percent of US consumers currently use a pre-owned smartphone, according to Circana. Certified devices account for roughly 30 percent of that installed base. Surveys reveal that nearly half of buyers received a device in “much better” condition than expected, and a majority of new-device purchasers said they would consider a certified used phone for their next upgrade.

Brad Akyuz, an industry analyst at Circana, stated the pre-owned category continues to outperform expectations. “The pre-owned smartphone market in the US remains incredibly resilient,” Akyuz said. He attributed this to strong consumer demand for affordable, high-quality devices and a growing pool of second-hand inventory. Improved refurbishment standards, greater transparency, and increased use of genuine parts have all helped increase buyer confidence, he noted.

Aging Inventory and Certification Challenges

However, the supply of phones eligible for premium Certified Pre-Owned (CPO) programs is tightening. Data from B-Stock indicates handsets five generations old or more accounted for 19 percent of pre-owned supply last year, a sharp increase since 2022. These aging devices typically fall outside CPO program criteria, which favor newer A- and B-grade stock.

Sean Cleland, Vice President of Mobile at B-Stock, explained the dynamic. “As carriers push payment terms out to 36 months, consumers are holding onto devices longer. trade-in volumes may look healthy, but fewer units meet certification thresholds,” Cleland said. He added that aging, lower-grade models typically are not eligible for US-based CPO programs.

The result is a shrinking pool of premium-grade inventory just as certified programs expand and consumer trust in them grows. This creates a supply challenge for retailers and carriers promoting trade-in and certified pre-owned initiatives.

International Competition for Supply

Compounding the domestic supply issue is robust international demand. A weaker US dollar has made American-sourced devices more attractive in overseas markets. Dubai and Hong Kong accounted for roughly 80 percent of the global volume for US-sourced used phones last year, while the Netherlands and Spain are emerging as high-growth destinations. Demand for legacy devices, particularly older iPhone models, remains strong across Southern Europe.

Cleland warned that international buyers, who often operate with lower labor and parts costs, are competing aggressively for older device supply. “Those dynamics are starting to pressure domestic refurbishers who don’t have the same cost structure or inventory access,” he said.

Future Market Developments

Market observers expect these trends to continue in the near term, contingent on broader economic conditions and carrier financing policies. The strain on premium inventory is likely to persist as upgrade cycles remain extended. Industry focus may increasingly shift toward improving the refurbishment and certification processes for older device grades to meet sustained consumer demand for affordable options. Meanwhile, competition between domestic refurbishers and international buyers for available inventory is anticipated to intensify, potentially influencing pricing and availability in the secondary smartphone market.

Source: Mobile News