The smartphone industry is bracing for its worst year since the early 2010s. IDC predicts global smartphone shipments will plummet to just 1.12 billion units in 2026, down from 1.26 billion last year—an 11% nosedive driven by a worsening memory shortage that's caught manufacturers completely off guard. It's the steepest annual decline in over a decade, and it's about to reshape how consumers think about upgrade cycles.
The smartphone industry just hit a wall it didn't see coming. IDC, the market research firm that's been tracking mobile shipments for decades, dropped a bombshell forecast on Thursday: phone makers will ship only 1.12 billion smartphones this year compared to 1.26 billion in 2025. That's not just a dip—it's an 11% freefall that marks the industry's steepest decline since the smartphone market matured.
The culprit? A memory shortage that's been quietly building for months and is now choking production lines from Seoul to Shenzhen. According to IDC's latest report, both DRAM and NAND flash memory—the essential ingredients in every modern smartphone—have become critically scarce just as manufacturers need them most.
The timing couldn't be worse. Apple, Samsung, and virtually every major phone maker have been racing to pack more memory into their devices to support AI features that consumers now expect as standard. The new generation of on-device AI models requires at least 12GB of RAM and 256GB of storage to run smoothly, but the supply simply isn't there to meet demand.
Samsung, which controls nearly 40% of the global memory market through its semiconductor division, has been unable to ramp up production fast enough. The company's advanced memory fabs are running at maximum capacity, but the complex manufacturing process for high-density memory chips means there's no quick fix. Industry insiders say it takes at least six months to meaningfully increase output, and that's assuming no additional complications.
The shortage is hitting mid-range and budget phones particularly hard. While flagship devices from and are still getting priority access to memory supplies, manufacturers like Xiaomi, OPPO, and smaller players are facing severe allocation constraints. Some have already pushed back product launches or announced they'll ship devices with less memory than originally planned—a tough sell when competitors are advertising AI capabilities that require more resources.
