The Reminiscence Scarcity Is So Unhealthy That Smartphone Shipments Hit a File Low

Global smartphone shipments fell 11% within the second quarter of this 12 months, marking the bottom degree since 2013, based on estimates from Counterpoint Research.

To blame are hovering smartphone costs, pushed incrementally increased as a world reminiscence chip scarcity worsens.

“The global memory crisis has now overtaken every other factor as the single biggest drag on the smartphone industry,” Counterpoint Research senior analyst Shilpi Jain stated within the launch.

The AI increase and the unprecedented information heart buildout have skyrocketed demand for high-bandwidth reminiscence chips. With the trillions of {dollars} flowing into scaling AI globally, the highest chipmakers have shifted their focus virtually fully to deal with the AI trade’s chip demand, albeit on the expense of client electronics producers. With finite chipmaking capability, consumer-level reminiscence provide has dragged, inflicting delays and worth hikes which were undeniably handed on to shoppers seeking to purchase devices that additionally depend on these reminiscence chips, similar to computer systems and smartphones.

But the affect just isn’t dealt equally. Demand for smartphones from Samsung and Apple within the second quarter was nonetheless fairly resilient, Counterpoint claims, with each phonemakers experiencing progress. Driven by the flagship Galaxy S26 collection and fewer worth hikes than some rivals, Samsung skilled the strongest progress in shipments.

Meanwhile, Apple’s market share rose to a document 20%, most likely due to its place as the one main smartphone producer that has largely averted worth hikes. But that actuality is wanting more likely to change with the upcoming iPhone 18, which latest experiences declare may very well be priced no less than $200 increased than the iPhone 17 Pro.

Apple CEO Tim Cook additionally advised the Wall Street Journal final month that the reminiscence chip scarcity had turn out to be “unsustainable,” making worth hikes for Apple merchandise merely “unavoidable.”

“This is a hundred-year flood,” Cook advised the WSJ. “I’ve never seen anything like it in any area in over 40 years.”

Instead of Samsung and Apple, the brunt of the decline in shipments was confronted by smartphone makers that enchantment to a extra budget-conscious client, similar to China’s Xiaomi and Oppo. Entry and mid-tier smartphones, that are priced significantly decrease than the iPhone, skilled main worth hikes as a result of manufacturing turned “structurally unfeasible at previous price points,” Jain stated.

Analysts foresee the reminiscence disaster persevering with into subsequent 12 months and past, with some specialists even seeing the scarcity and the accompanying worth hikes bleeding into the subsequent decade. Top reminiscence chipmaker SK Hynix’s CEO Kwak Noh-Jung advised Reuters final week that he expects 2027 to be the worst 12 months but for the reminiscence scarcity.

“We forecast that next year will be the worst year in the industry’s history from the supply perspective,” Kwak advised Reuters. “We still forecast that customer demand will remain higher than our supply capacity even beyond 2030.”

The Counterpoint report’s view can be pessimistic. As the scarcity continues into subsequent 12 months, the researchers anticipate shipments to be down round 14% for the total 12 months 2026.

“Overall demand recovery is unlikely until memory supply conditions improve substantially,” the corporate stated. If AI hype and hovering monetary commitments proceed as is, that enchancment in situations is unlikely to occur any time quickly.