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Global smartphone sales fall by six percent amid memory cost crisis
Global smartphone sales fell six per cent year on year to 272 million units in the second quarter of 2026, according to Omdia, as rising memory prices and supply-chain disruption worsen an already weak market. The decline particularly affects lower-cost manufacturers and could lead to sharper price rises for budget handsets, while better-resourced firms appear more able to absorb costs and protect their market positions.
Xiaomi’s shipments fell 26 per cent and Oppo’s 17 per cent, with price increases and smaller product ranges contributing to their losses. Samsung shipped 60.5 million phones and increased its market share to 22 per cent, while Apple shipped 55.1 million, up 23 per cent, reaching 20 per cent share; both companies benefited from stronger supply-chain resilience, although Samsung’s mobile unit still recorded a quarterly loss from higher costs.
In short
- Memory shortages are pushing global smartphone sales lower.
- Budget brands are suffering the steepest shipment declines.
- Apple and Samsung gained market share despite the downturn.
Explained simply
Memory chips are essential components in all modern smartphones, enabling storage and app performance. Global memory costs have risen sharply, and supplies have become constrained, creating pressure across the entire industry. This combination of high costs and limited availability forces manufacturers to make difficult business decisions.
The smartphone market includes companies of vastly different sizes with different resources. Large firms like Samsung and Apple have the scale, financial strength and established relationships with suppliers to navigate cost pressures more effectively. Smaller manufacturers and those focused on budget devices have less flexibility and tighter profit margins to absorb any increases.
If manufacturers pass rising costs on to consumers, it could reduce smartphone sales, particularly among budget-conscious buyers. The cost crisis may also reshape competition, as larger companies with greater financial strength are better positioned to maintain or grow their market share whilst smaller rivals face pressure.
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