IDC: Smartphone market faces record decline in 2026 as memory chip costs surge

By Tahani Elghazaly
Published February 26, 2026

Latest news on WhatsApp أجدد الأخبار على واتساب

IDC forecasts the global smartphone market will suffer its steepest annual drop on record in 2026, with shipments expected to fall 12.9% to about 1.12 billion units - the lowest level in more than a decade - as sharply higher memory (especially DRAM) prices push up handset production costs and squeeze margins.

IDC links the cost shock to the AI infrastructure boom, which has absorbed a growing share of memory supply and encouraged manufacturers to prioritize higher-margin data center demand over consumer devices, tightening availability and lifting component prices for phone makers.

The impact is expected to be most severe for low-end Android vendors, while Apple and Samsung could gain share thanks to stronger pricing power and the financial flexibility to absorb or pass through higher costs.

IDC also expects average smartphone selling prices to rise 14% in 2026 to a record $523 as brands tilt toward more premium models to offset higher bills of materials. The firm sees only a modest recovery afterward - around 2% growth in 2027 and 5.2% in 2028 - and warns the sub-$100 segment (about 171 million devices) could become structurally uneconomic even after memory prices ease.