[Mobile Sales] Omdia: Memory Constraints and Geopolitical Pressures Expected to Cause a 7% Drop in Global Smartphone Shipments by 2026, with Worst-Case Scenario Falling Over 15%

A report from market research firm Omdia shows that, due to memory constraints and geopolitical pressures, global smartphone shipments are expected to decline by 7% in 2026. Escalating geopolitical tensions in the Middle East could intensify macroeconomic fluctuations, including rising energy prices, increased shipping costs, and currency volatility. In the worst-case scenario, annual shipments could drop by over 15%, the largest decline in nearly a decade since 2022’s 12% decrease.

【Mobile Sales】Omdia: Memory Constraints and Geopolitical Pressures Project 7% Drop in Global Smartphone Shipments by 2026; Worst-Case Over 15% Decline

The organization states that tightening memory supply and rising prices are increasing production costs for smartphone manufacturers, posing severe challenges to the global smartphone market this year. Noticing that memory costs constitute a significant portion of the bill of materials (BOM) for phones, some manufacturers have started raising retail prices in Q4 2025 to maintain profit margins. However, continued price increases could weaken demand, especially in price-sensitive emerging markets, where consumers’ willingness to upgrade or replace devices is more easily affected by small price hikes.

Entry-Level Phone Shipments Expected to Drop 31%

Omdia Chief Analyst Zaker Li points out that rising memory costs and macroeconomic headwinds will have uneven impacts across different price segments. Entry-level models priced below $100, which already have low margins and are highly sensitive to cost changes, are expected to see shipments decline by nearly 31% year-over-year in 2026.

He further notes that core global sales in the $100–$399 mid-to-low range could also be affected. Rising memory prices may push retail prices higher, and since these models often rely on memory standards like LPDDR4X, which may be lower priority in the supply chain, supply constraints or inflation could more easily compress capacity and shipments, potentially resulting in double-digit declines for the year.

High-End Models Expected to Grow 4%

In contrast, the high-end market shows stronger resilience. Omdia states that brands with greater pricing flexibility can better absorb or pass on costs. It is estimated that smartphones priced above $800 could see a shipment increase of about 4% for the year.

The organization notes that changing cost environments are reshaping supply chains. As demand for entry-level and mid-range devices weakens, component suppliers such as chipsets and camera modules may face more pronounced order fluctuations and pricing pressures. Memory price volatility is also forcing brands to adopt shorter-term production plans and smaller order volumes.

These forecasts are based on the assumption that memory prices, along with price pressures and supply constraints, will begin to ease in the second half of the year.

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