Global smartphone shipments are expected to decline by 12 per cent this year due to persistent memory shortages, prompting manufacturers to raise prices and focus on premium models, with the secondary market experiencing growth amid tighter supplies.
Global smartphone shipments are set to fall sharply this year as the industry absorbs a prolonged memory shortage that is raising component costs and pushing manufacturers to lift prices, according to FDM CCS Insight. The analyst firm now expects a 12 per cent decline in global smartphone shipments in 2026, after the market showed more resilience in the first six months than it had anticipated.
FDM CCS Insight said shipments of new handsets dropped 7 per cent year on year in the second quarter, while average selling prices rose 13 per cent from the previous quarter. The firm attributed the deterioration to tight supplies of DRAM and related memory chips, which have been redirected towards AI infrastructure and large data centre customers, leaving consumer electronics makers to compete for fewer parts.
The pressure is already changing handset strategies. Manufacturers are passing higher input costs on to buyers and increasingly concentrating on premium models, while demand in North America and Europe has held up better than in price-sensitive markets. Apple was the only major smartphone maker to keep pricing broadly stable in the first half of 2026, but the analyst firm expects it to follow rivals and raise prices in the months ahead as component costs continue to rise.
The broader memory crunch appears likely to last well beyond this year. Samsung, the world’s largest DRAM producer, has warned that shortages could persist until at least 2028, reflecting both strong AI-related demand and the long lead times involved in building new chip plants. Separate reporting has also pointed to bottlenecks affecting Apple’s next-generation devices, including delays linked to memory availability and advanced chip packaging.
For consumers, the result is fewer affordable upgrade options. FDM CCS Insight said the gap between Android and iOS devices is narrowing as lower-specification phones become more expensive, which could leave Apple relatively well placed. Ekta Mittal, senior analyst at the firm, said financing, leasing and buyback schemes will be increasingly important as affordability comes under pressure.
The secondary market is benefiting, but supply there is also tight. FDM CCS Insight said the organised refurbished-phone market grew 3 per cent year on year in the quarter as buyers sought cheaper alternatives, though shortages of used handsets limited growth and lifted prices. The firm now expects the sector to expand 9 per cent this year, below its earlier forecast, and said stronger trade-in programmes will be needed to support future demand.
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