A severe memory shortage is expected to lead to a significant decline in smartphone shipments, according to a report by IDC. The analyst firm forecasts a 12.9% drop in smartphone shipments this year, marking the most substantial decrease in over a decade.
In 2025, manufacturers shipped 1.26 billion smartphones, but IDC anticipates this number falling to 1.12 billion in the current year due to the ongoing memory crisis. This shortage is not just a temporary setback; it signifies a structural reset of the market, causing fundamental changes to the Total Addressable Market (TAM), vendor landscape, and product offerings.
Nabila Popal, senior research director at IDC’s Worldwide Quarterly Mobile Phone Tracker, noted that the average selling price of smartphones is expected to increase by 14% as a result of the memory scarcity. The market is likely to witness consolidation with smaller players exiting, and low-end vendors experiencing sharp shipment declines due to supply constraints and reduced demand at higher price points.
While smartphone shipments are set to experience a record decrease, the Average Selling Price (ASP) is projected to reach a record $523 this year. Geographically, regions like the Middle East, Africa, China, and Asia Pacific (excluding Japan and China) are expected to see significant shipment declines ranging from 10.5% to over 20% year-over-year.
Despite the challenging outlook, IDC foresees RAM prices stabilizing by mid-2027, offering a glimpse of hope for the industry’s recovery from the current memory shortage crisis.
Source: TechCrunch