The continuing DRAM and NAND provide crunch will possible push most smartphone makers to boost costs this 12 months. Samsung’s lately introduced Galaxy S26 and S26+ already replicate that shift, debuting at $100 greater than their predecessors regardless of providing few significant upgrades. The ripple impact will not cease at pricing, with the worldwide smartphone market projected to shrink by nearly 13% this 12 months.
The newest IDC report predicts 1.1 billion smartphones will likely be shipped in 2026. That is 160 million items (12.9%) lower than in 2025, when shipments reached 1.1 billion (by way of Bloomberg). That may mark a pointy reversal after the trade loved regular cargo development within the post-COVID restoration interval.
If projections maintain, the drop in shipments would mark the steepest decline of the last decade, worse than the droop throughout the COVID years. It can additionally simply rank among the many most extreme downturns the smartphone trade has seen previously 20 years.
The most important affect will likely be felt within the low-end section. IDC’s Senior Analysis Director Nabila Popal believes “the times of low cost smartphones are gone, as even when the disaster is over, we do not anticipate reminiscence costs to return all the way down to 2025 ranges.”
Because of this, the sub-$100 smartphone class — a section that noticed 170 million shipments in 2025 — could now not make financial sense for producers. There’s simply not sufficient margin to soak up the worth hikes in DRAM and NAND.
Smartphones will get dearer
The common smartphone promoting value can be anticipated to rise by a whopping 14% this 12 months to a record-high of $523 in 2026. This is because of producers adjusting their machine costs to account for the upper DRAM and NAND costs.
The state of affairs ought to enhance by mid-2027 as reminiscence costs stabilize, with IDC projecting a 2% development in shipments. A stronger rebound ought to occur in 2028, with shipments rising by 5.2% yearly.
Samsung and Apple seem finest positioned to the DRAM and NAND disaster — and doubtlessly even develop their market share. The actual strain will fall on manufacturers that rely closely on low- and mid-range units, the place thinner margins depart far much less room to soak up rising element prices.
A lot of this disruption traces again to the AI growth. As main tech corporations scramble to construct large AI information facilities, they’re gobbling up all of the out there DRAM and NAND provides for his or her servers and high-performance methods. That is limiting provides for every part else, together with smartphones.