Counterpoint warns of rising retail prices for smartphones in 2026 as memory costs explode

"Higher retail prices are unavoidable in 2026 as rising costs will be passed to consumers. When building a typical low-end phone with 6GB of LPDDR4X RAM and 128GB of eMMC storage, manufacturers will have to spend a whopping 43% of the phone's total BoM on memory. This is an increase of 25% compared to the previous quarter."

"For a typical mid-ranger ($400-$600) with 8GB of LPDDR5X RAM and 256GB of UFS 4.0 storage, the manufacturer will spend 15% more on RAM and 11% more on storage. And that is if the phone is built in Q1 - in Q2, the numbers are expected to be 20% and 16%, respectively."

"The memory price surge is delivering a structural impact to smartphone BoM costs. In 2026, OEMs will struggle to balance component costs, gross margins and shipment targets. Those who rely heavily on entry-level models to drive market share will face a significant risk of short-term losses."

Memory component costs have surged dramatically, with mobile RAM increasing 50% and NAND storage rising over 90% quarter-on-quarter. Low-end smartphones are most severely impacted, with memory now consuming 43% of the bill of materials compared to 18% previously. Mid-range phones face 15-20% RAM cost increases and 11-16% storage increases. Premium flagships experience $100-$150 BoM increases despite larger margins. Manufacturers must pass these costs to consumers, with low-end phones rising approximately $30 and premium devices increasing $150-$200. This structural impact creates significant challenges for OEMs balancing component costs, margins, and shipment targets, particularly those relying on entry-level models.

Read at GSMArena.com