Smartphone Mkt to Decline 13% in '26, Largest Drop Ever Due to Memory Shortage
Source: Hacker News
Worldwide smartphone shipments are forecast to decline 12.9% year‑on‑year (YoY) in 2026 to 1.12 billion units, according to the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker. This will be the lowest annual shipment volume in more than a decade and marks a sharp revision from the November forecast amid an intensifying memory shortage crisis.
Forecast Overview
- 2026 shipment forecast: 1.12 billion units (‑12.9% YoY)
- Average selling price (ASP): projected to rise 14% to a record $523
- Memory price outlook: expected to stabilize by mid‑2027 but remain above pre‑crisis levels, making the sub‑$100 segment (≈ 171 million devices) permanently uneconomical
Industry Commentary
“What we are witnessing is not a temporary squeeze, but a tsunami‑like shock originating in the memory supply chain, with ripple effects spreading across the entire consumer electronics industry,” said Francisco Jeronimo, vice president for Worldwide Client Devices, IDC. “The global smartphone market, particularly Android manufacturers, faces a significant threat. Vendors whose business is mainly at the low end of the market are likely to suffer the most. Rising component costs will hit their margins, and they will have no choice but to pass the costs on to end users. By contrast, Apple and Samsung are better positioned to navigate this crisis. As smaller and low‑end‑positioned Android vendors struggle with rising costs, Apple and Samsung could not only weather the storm but potentially expand market share as the competitive landscape tightens.”
“The memory crisis will cause more than a temporary decline; it marks a structural reset of the entire market, fundamentally reshaping long‑term TAM (Total Addressable Market), the vendor landscape, and the product mix,” said Nabila Popal, senior research director with IDC’s Worldwide Quarterly Mobile Phone Tracker. “We expect consolidation as smaller players exit, and low‑end vendors face sharp shipment declines amid supply constraints and lower demand at higher price points. While shipments will witness a record drop, Smartphone ASP is projected to rise 14% to a record $523 this year. Although memory prices are projected to stabilize by mid‑2027, they are unlikely to return to previous levels — making the sub‑$100 segment permanently uneconomical. In short, there is no return to business as usual for vendors and consumers.”
Regional Impact
- Middle East & Africa: steepest decline at ‑20.6% YoY
- China: decline of ‑10.5% YoY
- Asia Pacific (ex‑Japan & China): decline of ‑13.1% YoY
IDC forecasts a modest 2% recovery in 2027 as the crisis stabilizes, followed by a stronger rebound of 5.2% YoY in 2028.
About IDC Trackers
IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets across more than 100 countries. Using proprietary tools and research processes, IDC’s Trackers are updated on a semi‑annual, quarterly, and monthly basis and delivered to clients via user‑friendly Excel deliverables and online query tools.
For more information about IDC’s Worldwide Quarterly Mobile Phone Tracker, please contact Jackie Kliem at 508‑988‑7984 or jkliem@idc.com.
About IDC
International Data Corporation (IDC) is the premier global provider of trusted technology intelligence, advisory services, and events. With more than 1,000 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 100 countries. IDC’s analysis and insights help IT professionals, business executives, and the investment community make fact‑based technology decisions and achieve their key business objectives. Learn more at www.idc.com.
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