A deepening memory supply crunch is set to push global smartphone shipments below 1.1 billion in 2026, marking a sharp decline and reshaping industry dynamics.
Global smartphone shipments are projected to decline by 12.4% year-on-year (YoY) in 2026, dropping below 1.1 billion units, the lowest annual volume since 2013, according to Counterpoint Research.
The contraction marks the sharpest on record and follows modest growth in 2025, when shipments rose 3.8% YoY in Q4, supported by holiday demand.
The downturn is being driven by a severe memory supply crunch, with mobile LPDDR4/5 prices in Q2 2026 expected to be nearly three times those seen in Q3 2025. Analysts warn that shortages will persist until late 2027, as new capacity takes time to materialise. OEMs are already delaying launches, streamlining portfolios and raising prices, with some Android brands increasing costs by 10–20% in January 2026.
On the other hand, premium segments are expected to remain comparatively resilient, with single-digit growth forecast, while the sub-$200 category could decline by more than 20%.
Apple and Samsung are likely to withstand pressures better due to stronger supply chain integration and pricing power. In contrast, lower-end OEMs, particularly those reliant on emerging markets, face sharper affordability challenges and rising component costs.
Regional declines are expected to be most pronounced in the Middle East and Africa (MEA), Latin America, and Asia Pacific, with shipments forecast to fall by 19%, 14%, and 14%, respectively.
Counterpoint notes that structural imbalances in the memory supply chain are at the heart of the crisis, as manufacturers divert wafer capacity toward higher-margin AI-focused DRAM and enterprise SSD NAND.
This has created a multi-quarter supply gap for mobile-grade memory, leaving OEMs with limited visibility and tighter allocation than at any point in the past decade. Industry consolidation is anticipated as smaller vendors struggle to absorb rising costs. Analysts also expect growth in the second-hand smartphone market, with budget-conscious consumers turning to sub-$300 devices as affordability pressures mount.
