Global smartphone shipments fell in the second quarter of 2026 amid a severe memory shortage that led to higher prices and weakened consumer demand, with industry analysts warning of further declines and price increases in the second half of the year.
Global smartphone shipments fell in the second quarter of 2026 as a severe memory shortage lifted handset prices and weakened demand, according to FDM CCS Insight. The research firm said average selling prices rose 13% quarter on quarter as manufacturers passed on higher component costs and shifted more buyers towards premium models. It now expects the primary smartphone market to contract by 12% in 2026, with more price rises likely in the second half of the year.
Ben Hatton, an analyst at FDM CCS Insight, said the first six months of 2026 held up better than expected, but warned that the outlook has deteriorated. He said the firm remains cautious about the rest of the year because memory shortages are expected to persist until 2028, keeping device prices elevated and consumer demand under pressure. In emerging markets, where buyers are more sensitive to price, many customers are delaying upgrades or turning to refurbished phones instead.
The weakness comes against a broader industry backdrop of rising memory costs tied to intense demand from artificial intelligence infrastructure. Gartner has projected that surging DRAM and SSD prices will push smartphone prices higher and weigh on shipments this year, while IDC has also forecast a substantial fall in global handset volumes. Some industry watchers say Apple is better insulated than most rivals because of its diversified supply chain, although FDM CCS Insight still expects the company to raise prices in the months ahead.
The secondary market is benefiting from the squeeze. FDM CCS Insight said organised refurbished-phone sales grew 3% in the second quarter, as shoppers looked for cheaper alternatives. Even so, supply was constrained there too, partly because fewer used devices were available after the United States reduced trade-in requirements. The firm now expects the organised secondary market to grow 9% in 2026, below its earlier forecast, and says stronger trade-in programmes will be important if demand is to be met.
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