Global smartphone shipments fell 11 per cent year-on-year in the April–June quarter (Q2 2026), touching the lowest second-quarter volumes since 2013, according to preliminary estimates from Counterpoint Research's Market Monitor released on Monday. The deepening memory shortage has now emerged as the single dominant drag on the industry, overtaking every other headwind.

Memory Crisis at the Core

DRAM and NAND prices continued to balloon through the quarter as memory suppliers prioritised AI data centre demand over consumer electronics. This forced original equipment manufacturers (OEMs) to pass rising Bill of Materials (BOM) costs onto consumers through repeated price hikes, hitting entry and mid-tier devices the hardest — segments that account for the majority of global smartphone volumes.

'The global memory crisis has now overtaken every other factor as the single biggest drag on the smartphone industry. What started as a components issue last year is now a full-blown demand issue. The entry and mid-tier devices, which account for a majority of the world's smartphone volumes and are the most exposed to BOM economics, become structurally unfeasible at previous price points,' said Shilpi Jain, senior analyst at Counterpoint Research.

Samsung Reclaims Top Spot, Apple Hits Record Share

Samsung reclaimed the global number one position with a 24 per cent market share in Q2 2026, recording the strongest growth among the top five brands. The South Korean giant held up relatively well in India and the Middle East, supported by better product availability, fewer price hikes, and aggressive summer promotions that complemented flagship momentum, according to the report.

Apple was the only major OEM to avoid smartphone price hikes during the quarter. Its shipments grew 3 per cent year-on-year, with market share climbing to a record 20 per cent — a sign that premium-tier demand remains comparatively insulated from BOM pressures.

Macro Squeeze Compounds the Pain

Geopolitical tensions in the Middle East pushed up oil and shipping costs, further inflating handset prices across the board. This coincided with a broader macro squeeze — slower global growth, elevated inflation, and record-low consumer sentiment — which hit price-sensitive buyers disproportionately hard, Jain noted.

Notably, this is not merely a supply-side disruption. The sustained price increases have begun to suppress replacement cycles, turning a components crunch into a structural demand problem that could outlast the memory shortage itself.

Outlook for 2026 and Beyond

The road ahead remains difficult. Counterpoint Research continues to project global smartphone shipments will decline by approximately 14 per cent for the full year 2026. The memory shortage is expected to persist into 2027, suggesting the industry faces at least another four to six quarters of constrained volumes before meaningful relief arrives.