The Global Market for Rugged Handheld Computers & Smartphones

Inside this Report:

This report covers the overall market opportunity for rugged handheld computers, rugged smartphones, and consumer-grade smartphones used to support enterprise line-of-business applications. It includes market sizing and forecasts by region, country, industry, application environment, ruggedness, OS, and display size. The report provides market participants with strategic insights, discussing current commercial and technical trends driving enterprise mobility investments and assessing the competitive landscape.

What Questions are Addressed?

• What is the outlook for rugged handheld computers and smartphones used for enterprise and government mobility applications?
• What is the relative opportunity by regional market, industry, and application?
• How is the use of consumer devices/smartphones impacting the opportunity for purpose-built solutions? How do rugged OEMs differentiate from competitors as eco-design legislation pushes for longer life span, more durable consumer phones?
• How is the competitive landscape evolving as the market matures? What is the impact of lower-cost Asia brands as they expand beyond their home country markets?
• How do mobile device requirements align with specific vertical markets and applications?
• How will AI be used to support workflows through rugged handheld mobile computers and smartphones? What is the demand for true on-device AI capabilities?
• What is the demand for 5G enabled devices and private cellular? How are connectivity requirements evolving for enterprise mobility solutions?
• What steps are OEMs taking to appeal to customers seeking sustainable solutions?
• How are tariffs and economic uncertainty impacting the market from a vendor performance and ASP perspective? How are OEMs adapting to increased demand for mid and low tier devices?

Who Should Read This Report?

The target audience for this report is decision-makers with marketing, sales, product development, and/or partner development functional responsibilities within mobile device OEMs; organizations distributing, reselling, and/or integrating enterprise mobility solutions in addition to enterprise mobility investment decision makers.

Organizations Listed in this Report:

Executive Summary

OEMs overcame key challenges in 2024 related to channel partners' destocking after taking on excess inventory to counter market volatility and supply chain disruptions. Demand from Teir 1 customers, especially in retail and logistics, returned after upgrades were pushed in 2023. In 2025 and looking ahead to 2026, Tier 1 refreshes are expected to continue driving strong growth in the market. Economic uncertainty and global conflict may have an impact on investments contributing to a slower resurgence, but large deals for 2025 and 2026 are expected to proceed as planned.

Rugged smartphones and handheld computers share a lot of commonalities from a technology stack perspective but historically support differing workflows in enterprise and government. While some workflows overlap, rugged smartphones tend to align with field-based applications that require cellular connectivity. In addition, rugged smartphones align well with PTT-centric use cases in sectors like public safety, field service, construction, energy, and delivery services. Conversely, rugged handheld computers widely support data-capture centric use cases in segments like logistics, delivery services, retail, and manufacturing.

Large deal activity will drive growth in the rugged handheld computer market through 2027, as organizations look to refresh their aging installed base. Giant retail and logistics customers demand tens or even hundreds of thousands of mobile devices during a refresh cycle and heavily influence the overall market when they occur. While many refreshes happen on a rolling basis, massive volumes are still deployed concurrently driving significant revenue growth for the leading vendors fulfilling those orders. Typically, large deals like those expected in the coming years are negotiated at a lower price than smaller deployments, so we might expect the overall market ASP to decrease as a result. Despite this, uncertainty around tariffs is prompting rugged handheld computer vendors to increase their ASPs. While rugged handheld computers are currently exempt from tariffs (electronics exemptions), many accessories and other adjacent technologies are not, and these rules could seemingly change at a moment's notice. Regardless of the uncertainty, vendors profits will certainly be impacted, production will be shifted from China to other global locations, and pricing increases and adjustments will be necessary. Most of the leading rugged handheld computer vendors have already announced general or specific plans to increase pricing and those that have not are expected to follow this trend.

In addition to special-purpose ruggedized handheld computers, enterprises are leveraging general-purpose smartphones for various line of business workflows. This represents a combination of low end/entry class smartphones and flagship devices from the leading smartphone OEMs. Apple and Samsung have been the most active of the large smartphone OEMs in the enterprise space, but Google is beginning to penetrate the market with its Google Pixel line as well. Consumer-grade smartphones are being deployed to support line of business applications across retail, healthcare, transportation, public safety, defense, utilities, and other market segments. These consumer-grade devices are frequently accessorized to create more functional enterprise solutions and are leveraging more advanced software-based scanning solutions to directly challenge special-purpose ruggedized handheld computers with dedicated integrated scanning capabilities.

Key Findings:

• Pricing pressure in the rugged handheld computer market continues to mount as the value-tier segment of the market expands. In addition, competition from consumer smartphones - often leveraging software-based scanning applications - and other form factors such as tablets is further challenging the dynamics of this product segment.
• A key challenge with Android is its persistent upgrade cycle merry go round. While OEMs and ISVs have invested significantly to provide customers with the necessary enterprise support frameworks to manage their devices, the support required to regression test application and address security compliance requirements with each OS update represents a key challenge.
• Despite receding support and maintenance options, some organizations (mostly in industrial logistics environments) will continue to use legacy Windows CE- powered devices extending the life of the installed base. Within a few years these device fleets will need to be updated. At the end of 2024, VDC estimated the installed base of legacy Windows CE- powered handheld computers
• Growth in the rugged handheld computer market will be driven by large investments in the transportation/logistics and retail sectors over the next three years. These two sectors not only represent the largest verticals in the market today but are also among the fastest growing over the five-year forecast period.
• Security is a key barrier for many enterprise mobility modernization efforts and represents a frequent disconnect between corporate IT and operations. Cumbersome corporate security mandates often create employee friction and poor user experiences burdening service desks with access authentication issues.
• Artificial Intelligence (AI) is a point of emphasis for most rugged OEMs and their customers. Organizations are adopting diverse strategies for generative AI (genAI) and making the right choices at opportune times will provide a significant competitive edge.
• Sustainability has never been more important to consumers of rugged mobile technology. OEMs are boosting eco-friendly practices to appeal to more customers. Initiatives include green packaging, use of recycled plastics and organic materials in electronics, environmentally conscious disposal, and improved energy efficiency. As eco-design legislation begins to take effect, rugged vendors will need to further extend mobile device life cycles and find other ways to differentiate from more ruggedized consumer grade devices.
• Consumer-grade smartphones are increasingly being adopted in enterprise environments, driven by the aggressive positioning of Apple, Samsung, and Google in the business mobility space. Their familiarity, intuitive user interfaces, and broad ecosystem support make them appealing options for both IT decision-makers and frontline workers across retail, healthcare, transportation, and other industries.