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Silicon Republic
Smartphone shipments down 11pc after sustained chip shortage
Smartphone shipments have plunged 11% year-on-year, largely due to a chip shortage affecting memory components, which has led to increased prices across the market. Cheaper smartphone manufacturers have been hit hardest, with many passing rising costs onto consumers, resulting in a significant drop in sales. As manufacturers prioritize memory production for AI applications over consumer electronics, consumers are forced to reevaluate their purchasing decisions, gravitating towards higher-end brands like Apple, which has avoided price hikes.
MonitorConfidence: HighShort term horizonSupply chain risk: High
Published 18 Jul 2026, 11:56 UTC2 min read
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Summary
TL;DR
- 11% decline in global smartphone shipments in Q2 due to memory shortages.
- Manufacturers of affordable devices saw steep market share drops after price hikes.
- Apple and Huawei managed to maintain steady pricing amidst competitors' increases.
- Memory suppliers prioritizing DRAM and NAND tech for AI data centers.
- Geopolitical tensions have further affected component and shipping costs.
Interesting facts
- This is the lowest second-quarter smartphone shipment level in 13 years.
- Apple's market share rose from 17% to 20% despite overall market decline.
- Most Android vendors in China raised prices, impacting consumer upgrading behavior.