These folks were among those who flagged how serious the memory chip shortage actually was and would be. See after the jump.
From Counterpoint Research May 31:
- Global smartphone shipments are now forecast to fall 13.9% YoY in 2026, dropping to 1.08 billion units, the lowest annual volume since 2013, and a steeper contraction than our February forecast of 12.4%.
- A memory supply crisis, driven by capacity reallocation toward AI-focused HBM and server DRAM, is the primary driver of the downturn, with LPDDR4/5 prices expected to treble in Q2 2026 relative to Q4 2025, per Counterpoint’s Memory Service.
- Lower-end OEMs and Emerging Markets face the sharpest pressure, with LPDDR4 memory supply tracking to a decline of over 40% in 2026; the sub-$150 segment faces an effective permanent removal in some markets.
- Apple and Samsung are the most insulated OEMs, while Huawei is the only Chinese brand expected to grow shipments in 2026.
- The Iran conflict and the closure of the Strait of Hormuz add a geopolitical dimension to the downturn, though macroeconomic headwinds are expected to be materially less severe than the post-Ukraine inflationary shock.
Seoul, Beijing, Berlin, Buenos Aires, Fort Collins, Hong Kong, London, New Delhi, Taipei, Tokyo – June 1, 2026
The global smartphone market has entered its deepest period of contraction on record, according to Counterpoint Research's latest Smartphone Market Outlook Tracker, with full-year 2026 shipments now forecast to decline 13.9% YoY to 1.08 billion units, a downward revision from the 12.4% decline projected in February. The trigger is a worsening memory supply crisis that has accelerated sharply in recent weeks, compounded by the outbreak of the Iran conflict.
Memory crisis deepens the 2026–2027 downturnThe Q1 2026 smartphone market retreated 3.1% YoY, marking the first decline after nine consecutive quarters of growth. The performance was nonetheless better than expected, as OEMs moved to front-load shipments and clear pre-shock inventory ahead of expected price increases. However, the deterioration since has been sharp. Counterpoint Research's Memory Service indicates that mobile LPDDR4/5 prices in Q2 2026 are on track to treble relative to Q4 2025 levels, with the squeeze expected to persist through H2 2027 given the capital intensity and lead times inherent to semiconductor manufacturing.
The damage is falling disproportionately on lower-end devices. LPDDR4 supply is expected to decline more than 40% in 2026 as fabs reallocate capacity toward AI-driven HBM and server DRAM, making it increasingly uneconomical to supply entry-level products. Globally, smartphone wholesale prices rose 14% in Q1, and the pace will sustain as pre-shock inventory is exhausted. Certain sub-$150 price tiers face effective permanent ejection from the market.
Principal Analyst Yang Wang commented, “The memory crisis is the most disruptive supply-side event the smartphone industry has ever faced. Unlike demand-driven slowdowns, such as seen during COVID and 2022-23, the current contraction will not respond to pricing, channel and product planning adjustments. OEMs in the low- and mid-tier are caught between unabsorbable cost increases and consumers with hard affordability ceilings. The narrative around the smartphone market is no longer how to grow shipments or market share, but whether to remain in the market at all.”
Premium resilience, OEM divergence, and the road to recovery
....MUCH MORE
So the question becomes: Will the increase in average selling price brought about by the shift to more expensive phones be large enough to offset the decline in unit volume?
Previously from Counterpoint:
January 2026 - Chips: "2026 Smartphone Shipment Forecasts Revised Down as Memory Shortage Drives BoM Costs Up"
February 2026 - Electric Vehicles: "Ford Looks for Model-T Redux with UEV Plan" (F)
May 2026 - Computex 2026: Agentic AI & Physical AI Reshaping the Computing Landscape
