The ongoing DRAM and NAND supply crunch will likely push most smartphone makers to raise prices this year. Samsung’s recently announced Galaxy S26 and S26+ already reflect that shift, debuting at $100 more than their predecessors despite offering few meaningful upgrades. The ripple effect won’t stop at pricing, with the global smartphone market projected to shrink by almost 13% this year.
The latest IDC report predicts 1.1 billion smartphones will be shipped in 2026. That’s 160 million units (12.9%) less than in 2025, when shipments reached 1.1 billion (via Bloomberg). That would mark a sharp reversal after the industry enjoyed steady shipment growth in the post-COVID recovery period.
If projections hold, the drop in shipments would mark the steepest decline of the decade, worse than the slump during the COVID years. It will also easily rank among the most severe downturns the smartphone industry has seen in the past two decades.
The biggest impact will be felt in the low-end segment. IDC’s Senior Research Director Nabila Popal believes “the days of cheap smartphones are gone, as even when the crisis is over, we don’t expect memory prices to go back down to 2025 levels.”
As a result, the sub-$100 smartphone category — a segment that saw 170 million shipments in 2025 — may no longer make economic sense for manufacturers. There’s just not enough margin to absorb the price hikes in DRAM and NAND.
Smartphones will get more expensive
The average smartphone selling price is also expected to rise by a whopping 14% this year to a record-high of $523 in 2026. This is due to manufacturers adjusting their device prices to account for the higher DRAM and NAND prices.
The situation should improve by mid-2027 as memory prices stabilize, with IDC projecting a 2% growth in shipments. A stronger rebound should happen in 2028, with shipments growing by 5.2% annually.
Samsung and Apple appear best positioned to the DRAM and NAND crisis — and potentially even grow their market share. The real pressure will fall on brands that rely heavily on low- and mid-range devices, where thinner margins leave far less room to absorb rising component costs.
Much of this disruption traces back to the AI boom. As major tech companies scramble to build massive AI data centers, they are gobbling up all the available DRAM and NAND supplies for their servers and high-performance systems. This is limiting supplies for everything else, including smartphones.
