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Android Authority
Sub-$400 phones could see a huge decline due to RAM crisis
The ongoing RAM crisis is leading to price hikes across smartphone categories, with sub-$400 models predicted to be particularly affected. Research indicates that RAM costs could represent 59% of the bill-of-materials for these devices by 2026, up from 32% in 2025. Consequently, manufacturers might pivot to more premium devices to maintain profit margins as shipments of cheaper models are expected to drop 22%. This trend emphasizes the financial pressures on consumers looking for budget-friendly smartphones.
MonitorConfidence: MediumShort term horizonSupply chain risk: High
Published 8 Jul 2026, 04:40 UTC1 min read
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Summary
TL;DR
- RAM accounts for 59% of BOM costs for sub-$400 phones by Q1 2026
- Significant price increases expected in the budget smartphone segment
- Manufacturers may prioritize premium models over cheaper alternatives
- 12% contraction in the global smartphone market projected for 2026
- Sub-$100 phones see RAM costs represent 64% of their BOM
Interesting facts
- The RAM crisis is set to tighten profit margins for manufacturers.
- Cheaper devices are becoming increasingly less viable in the current market scenario.
- Last-gen smartphones may become a more attractive option for budget-conscious consumers.