Memory shortage could cause the biggest smartphone shipments dip in over a decade | TechCrunch

"The memory crisis will cause more than a temporary decline; it marks a structural reset of the entire market, fundamentally reshaping long‑term TAM (Total Addressable Market), the vendor landscape, and the product mix. We expect consolidation as smaller players exit, and low-end vendors face sharp shipment declines amid supply constraints and lower demand at higher price points."

"Although shipments will witness a record drop, Smartphone ASP is projected to rise 14% to a record $523 this year. The firm said that, because of this trend, the Middle East and Africa will face shipments dropping over 20% year-over-year. Other markets like China and Asia Pacific (excluding Japan and China) will also decline by 10.5% and 13.1%, respectively."

"Brands now face a simple choice: raise prices by 30% or more in some cases, or downgrade specs. The memory modules for smartphones have started costing more for manufacturers, forcing difficult decisions about pricing strategy and product specifications in response to the RAM shortage."

A critical RAM shortage driven by increased demand for AI computing and data centers is triggering a structural market reset in the smartphone industry. IDC predicts smartphone shipments will plummet from 1.26 billion devices in 2025 to 1.12 billion in 2026, marking the steepest decline in over a decade. Paradoxically, average smartphone prices are expected to surge 14% to a record $523 due to memory scarcity. This crisis will force market consolidation, with smaller vendors and low-end manufacturers facing severe shipment declines. Regional impacts vary significantly, with Middle East and Africa experiencing over 20% drops, while China and Asia Pacific decline by 10.5% and 13.1% respectively. RAM prices are projected to stabilize by mid-2027.

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