Smartphone sales will fall 13% in 2026 due to RAM crisis, says IDC

The predicted shortage of memory chips worldwide will have a more serious impact on smartphone sales in 2026 than expected, according to new data from International Data Corporation Worldwide. While in November alone the company had estimated a decline of between 0.9% and 5.2% (the latter being its “worst-case scenario”), it now projects a decline of 12.9% this year, based on its Worldwide Quarterly Mobile Phone Tracker.

“What we are seeing is not a temporary crisis, but a tsunami-like shock from the memory supply chain, with ripple effects spreading throughout the consumer electronics industry,” Francisco Jeronimo, vice president of global client devices at IDC, said in a statement.

The hardest hit companies are expected to be those selling their products to the lower end of the market, which cannot absorb higher component costs while maintaining profitable margins. As a result, Jeronimo says, many of these players will pass on the additional costs to consumers.

This also includes regional markets like the Middle East and Africa, which mainly sell cheap smartphones, which could see a sharp decline of 20.6% year-on-year.

On the other hand, IDC expects that Apple and Samsung will be better able to withstand the crisis. “As smaller, lower-end Android vendors struggle with rising costs, Apple and Samsung could not only weather the storm, but potentially increase their market share as the competitive landscape tightens,” Jeronimo said.

Memory has become scarce due to the insatiable demand to power generative AI. Almost all of the memory that will be manufactured this year is already reserved. What started as a demand for graphics processors has expanded to other components. For example, hard drive manufacturer Western Digital announced in early February that it had already exhausted its stocks for 2026.

“We expect consolidation as smaller players exit and low-end vendors face sharp declines in shipments due to supply constraints and lower demand at higher price points,” said Nabila Popal, senior research director at IDC, forecasting a 14% rise in the average smartphone selling price to $523.

Popal expects memory prices to stabilize by mid-2027, but does not see them returning to previous levels. The sub-$100 segment, made up of about 171 million devices, will be “definitely unprofitable,” she said. “In short, there is no return to business as usual for sellers and consumers.”