Global smartphone market rattled by growing memory crunch

• Counterpoint and Omdia publish smartphone market estimates for Q1 2026
• Growth figures and vendor rankings differ, but the overall message is fairly bleak
• The global smartphone market is expected to be further buffeted by supply and macro economic pressures as the year progresses

The first preliminary estimates of global smartphone shipments during the January to March quarter (Q1) of 2026 are starting to trickle in, with a particular focus on the disruption that is being inflicted on the PC, tablet and mobile phone markets by a severe, supply-driven “memory crunch”, as noted by Counterpoint Research.

Counterpoint and Omdia were first off the blocks with their respective smartphone numbers, although IDC looks set to follow suit.

While Counterpoint and Omdia provide varying numbers for Q1 shipments (presumably owing to different methods of calculation, although both refer to sell-in shipments), they provide a similar message: The smartphone market is under considerable pressure from supply-side bottlenecks and rising costs, as well as wider macroeconomic and geopolitical turbulence.

Omdia initially offers a moderately positive message by observing that the global smartphone market performed above expectations in Q1, growing by 1% year on year. However, it quickly provides the caveat that this growth does not yet reflect the full impact of rising supply-side costs, “as vendor inventory frontloading in the channel temporarily supported shipments”.

“Memory and storage costs are increasing sharply, while vendors have not fully implemented retail price increases across all markets. Mobile DRAM and NAND prices rose by around 90% quarter on quarter in Q1 and are expected to increase a further 30% in Q2, significantly increasing bill-of-materials. At the same time, early signs of logistics and trade flow disruption are adding friction to global supply chains,” the Omdia researchers said.

Runar Bjorhovde, principal analyst at Omdia, warned that the worst is still ahead as cost-driven headwinds weigh on the smartphone value chain. “Omdia expects the global smartphone market to be increasingly skewed to the downside in 2026, with shipments likely to decline by around 15% amid escalating costs and macro volatility,” he said. 

Counterpoint also paints a bleak picture for 2026 to date, reporting that shipments declined 6% in Q1 and blaming this on the shortage of DRAM and NAND memory components and weaker demand. The research firm added that the outlook for 2026 remains weak, “as the memory crunch may last until late 2027”. 

“OEMs are expected to prioritise value over volume, configuration updates, cutting low-margin models, and leveraging refurbished devices to retain budget users. With premiumisation holding steady but margins under pressure, brands will increasingly rely on software, ecosystem expansion and services for growth in the coming quarters,” the Counterpoint researchers said. 

Counterpoint senior analyst Shilpi Jain provided additional context by explaining that the decline in shipments is primarily driven by “memory players prioritising AI datacentres over consumer electronics, leaving OEMs with compressed margins and forcing them to pass increased bills of material costs directly to the consumer”.

She added: “While supplies remained constrained, rising energy prices, higher logistics costs, and economic uncertainty driven by tension in the Middle East kept consumer sentiment for new devices low, driving demand for refurbished devices and further weighing on shipments.”

As for IDC, it predicted back in February that worldwide smartphone shipments will decline 12.9% year on year to 1.1 billion units, again owing to the crisis in the memory supply chain. 

Apple versus Samsung 

Meanwhile, Omdia and Counterpoint also differ on which vendor topped the ranking in the first quarter of this year. 

According to Omdia, Samsung “reclaimed the top position” in the quarter, “supported by resilient flagship demand and strong Galaxy S26 series pre-orders”. The report puts Samsung first with a 22% market share (20% in 2025), followed by Apple with 20% (19%), Xiaomi with 11% (14%), Oppo with 10% (11%) and Vivo with 7% (8%). 

However, Counterpoint said Apple led the market for the first time in Q1, achieving a 5% rise in shipments and increasing its share from 19% last year to 21%. Its resilience was attributed to its “ultra-premium positioning and highly integrated supply chain”. In contrast, Samsung’s shipments declined by 6%, but it retained a 20% market share, the firm added. 

Xiaomi registered a fairly hefty 19% drop in shipments, taking its market share to 12% (down from 14% in 2025), while Oppo’s shipments fell by 4% to give it an 11% share (flat with a year ago), and Vivo’s shipments dipped by 2%, though, because the market shrank so much, its market share actually increased to 8% from 7% in Q1 2025. Counterpoint also noted that Google and Nothing witnessed “significant” shipments growth of 14% and 25%, respectively.

- Anne Morris, Contributing Editor, TelecomTV