Smartphone sales may see their biggest decline ever

The smartphone industry could see a record decline in 2026 as a result of RAM shortages caused by memory-hungry AI giants. That depends Latest report from International Data Corporation (IDC), which expects smartphone shipments to decline by 12.9% this year, representing its “lowest annual shipment volume in more than a decade.”

Meanwhile, the average selling price of smartphones is expected to reach new highs, with IDC forecasting a 14% increase to a record high of $523. “While memory prices are expected to stabilize by mid-2027, they are unlikely to return to the previous level,” says Nabila Popal, senior researcher at IDC, adding that a sub-$100 phone chip will become “completely uneconomical.” Next week, Apple is rumored to be announcing a new version of its budget smartphone called the “iPhone 17e,” which could give a hint as to where things are going.

Memory shortages are expected to impact budget-friendly Android smartphones the most, as rising component costs leave them “no choice but to pass on costs to end users,” Francisco Geronimo, vice president of global client devices at IDC, says in the report. This could drive smaller brands out of the industry, while allowing Apple and Samsung to capture a larger share of the market, according to Bhopal.