Rising memory prices are reshaping expectations for the global smartphone market, prompting analysts to lower shipment forecasts for next year. Counterpoint Research now expects the market to contract in 2026, reversing its earlier outlook of flat growth.
Counterpoint said it now forecasts global smartphone shipments to decline by 2.1% in 2026. The revision follows sharp increases in RAM prices over recent months, which the firm expects to continue. Memory prices could also rise by a further 40% through the second quarter of 2026.
The higher component costs are already affecting smartphone manufacturing economics. The bill of materials for low-end smartphones is currently about 25% higher than at the start of the year. Mid-range devices have seen cost increases of around 15%, while high-end models are facing roughly 10% higher component costs. If the forecast for the second quarter holds, overall bills of materials could rise by an additional 8% to 15%.
Counterpoint now expects lower smartphone shipments across most major brands. Oppo and vivo were previously forecast to grow shipments in 2026, but the revised outlook points to declines for both companies. Xiaomi and Honor are expected to see larger declines than previously anticipated, with Honor facing the steepest downward revision.
Apple and Samsung are also expected to feel the impact of rising costs, though to a lesser extent. Senior Analyst Yang Wang said Apple and Samsung are better positioned to manage the next few quarters compared with smaller rivals, particularly those with limited flexibility to balance market share and profit margins. He added that the pressure will be most visible among Chinese smartphone brands as the year progresses.
Smartphone makers are already adjusting to higher component costs by reshaping their product lineups. Senior Analyst Shenghao Bai said some manufacturers have begun downgrading specifications in certain models. These changes include lower-end camera modules, the removal or simplification of periscope camera systems, reduced display quality, changes to audio components, and smaller memory configurations.
Counterpoint also revised its forecast for average selling prices (ASPs) in 2026. The firm now expects ASPs to rise by 6.9%, up from an earlier estimate of 3.9%. Analysts said this could push manufacturers to steer consumers toward higher-end models, where memory costs account for a smaller share of the overall bill of materials.