The global smartphone market is projected to contract sharply in 2026, with shipments expected to fall 12.9% year-on-year to 1.1 billion units, according to the latest forecast from research firm IDC.
If realized, the decline would mark the steepest annual drop on record and push worldwide smartphone shipments to their lowest level in more than a decade.
IDC said the revised outlook represents a significant downgrade from its November forecast as a worsening memory-component shortage ripples across the consumer electronics supply chain.
“What we are witnessing is not a temporary squeeze, but a tsunami-like shock originating in the memory supply chain, with ripple effects spreading across the entire consumer electronics industry,” said Francisco Jeronimo, IDC vice president for Worldwide Client Devices.
IDC warned that Android vendors — particularly those focused on entry-level devices — will be most exposed to rising component costs, which are expected to erode margins and force price increases.
By contrast, the research firm said market leaders Apple and Samsung are better positioned to absorb supply disruptions and could gain market share as smaller competitors struggle.
“The memory crisis will cause more than a temporary decline; it marks a structural reset of the entire market, fundamentally reshaping long-term total addressable market, the vendor landscape, and the product mix,” said Nabila Popal, senior research director for IDC’s Worldwide Quarterly Mobile Phone Tracker.
Popal added that consolidation is likely as supply constraints and higher retail prices pressure low-end manufacturers. While shipment volumes are forecast to fall sharply, IDC expects average selling prices (ASP) to rise 14% in 2026 to a record $523, reflecting higher memory costs and a shift toward midrange and premium devices.
IDC also believes the ultra-budget segment may not recover. Memory pricing is projected to stabilize by mid-2027 but is unlikely to return to earlier lows, making sub-$100 smartphones — estimated at 171 million units previously — “permanently uneconomical.”
Regionally, markets with a heavy concentration of entry-level devices are expected to see the largest declines. Shipments in the Middle East and Africa are forecast to drop 20.6%, while China and the broader Asia-Pacific region (excluding Japan and China) are projected to fall 10.5% and 13.1%, respectively.
Looking ahead, IDC expects only a modest 2% recovery in 2027 as supply conditions begin to stabilize, followed by a stronger rebound of 5.2% in 2028 — though the firm emphasized that the industry is unlikely to return to pre-crisis dynamics.
