Memory shortage drives smartphone shipments to historic lows, benefiting Apple and Samsung
▼ Summary
– Smartphone shipments dropped 11% in Q2 2026, hitting the lowest second-quarter level since 2013.
– The decline is blamed on rising DRAM and NAND chip costs, as manufacturers prioritize AI computing over consumer devices.
– Higher memory costs hurt budget phones (under $500) most, with memory now accounting for half of manufacturing costs.
– Among top five makers (Samsung, Apple, Oppo, Vivo, Xiaomi), Apple saw 3% shipment growth by keeping prices stable.
– Oppo, Vivo, and Xiaomi all saw sales decline in Q2 2026, while Apple and Samsung shipments held up better.
Global smartphone shipments hit a historic low last quarter, falling 11 percent year over year, according to a new report from Counterpoint. This marks the weakest second-quarter performance since 2013, as the industry struggles under the weight of soaring memory costs. The culprit? A sharp rise in DRAM and NAND chip prices, driven by manufacturers pivoting production capacity toward the booming AI computing sector. Fewer components are available for consumer devices like smartphones and PCs, and as those costs climb, consumer demand has cooled.
The pain is especially acute in the budget smartphone segment. A separate analysis from Omdia reveals that for phones priced at $500 or less, memory now accounts for roughly half of total manufacturing costs. That’s a dramatic increase, and it has forced manufacturers to raise prices more aggressively on affordable devices than on flagship models. While memory now makes up more than a quarter of a high-end phone’s cost,up significantly from last year,flagship margins remain healthier, giving premium brands more room to absorb the shock.
Samsung, Apple, Oppo, Vivo, and Xiaomi still dominate the top five, but their fortunes diverge sharply. Apple bucked the trend with 3 percent shipment growth in Q2 2026, largely by keeping prices stable on its current generation while rivals hiked theirs. Samsung also held up relatively well, but Oppo, Vivo, and Xiaomi all saw declines. Whether Apple can maintain that pricing discipline when it launches new iPhones later this year remains an open question. For now, the memory shortage is reshaping the competitive landscape, favoring the two companies with the deepest pockets and the strongest pricing power.
(Source: Ars Technica)
