It depends on the company. Most will refurbish the phone and sell it as a second-hand device. Many Apple stores, for example, have a very active second-hand market for those customers who can’t afford a new iPhone. Samsung shops have similar marketplaces. Second-hand sales are a core component of Amazon, Decluttr, and GadgetGone’s business model. Some companies use these old phones as spare parts to repair other phones. This is a very competitive market, especially with older Apple devices. They may sell your phone to smartphone repair shops for that very purpose. Sometimes they simply recycle them. This is rare, but especially in cases where brands like Apple or Samsung buy another manufacturer’s phones, they may not have much that they could do with the phones. For them, it’s profitable enough that they already have a new customer that they “stole” from the competition, and they see that as an absolute win. Lastly, some of these phones are donated to the less fortunate. There are non-profit organizations that donate smartphones and other electronic devices to third-world countries and those less fortunate to help them get online. Companies that buy second-hand phones may donate these devices for these NPOs, and they get to write it off as tax-deductible charitable donations.