Smartphone Shipments Fall 20% to 14-Year Low as Memory Costs Hit Prices

Fewer new phones left factories this summer than in any third quarter since 2012. Counterpoint Research estimates that global smartphone shipments fell 20% year on year in July to September 2026.

The reason is not a sudden loss of interest in phones. It is memory. The chips that store your photos and run your apps are being swallowed by AI data centres, and phone makers are paying far more for what is left. They are passing the bill on to buyers.

Based on Counterpoint Research's October 12 release and its September price tracker, plus Reuters and IDC data, checked October 13, 2026. Counterpoint's figures are preliminary sell-in estimates (shipments to retailers and carriers, not sales to shoppers). IDC, Omdia and Canalys had not published Q3 2026 figures that we could find.

What Counterpoint found

According to Counterpoint's release, shipments declined 20% from a year earlier, “the lowest Q3 level since 2012”. The firm says the drop was close to what it expected.

Counterpoint blames “relentless increases in DRAM and NAND prices”, the two main types of memory in a phone. Those increases “sharply inflated BOM (Bill of Materials) costs and deepened supply shortages, significantly disrupting OEM shipments.” Reuters' report on the data describes why memory is scarce: AI infrastructure projects are cornering supplies.

Senior analyst Shilpi Jain said: “Q3 was the second successive quarter to take the full brunt of the memory crisis.” She added that “Consumers are holding on to their devices longer than estimated, increasingly considering refurbished devices and prioritizing higher-value devices.”

Counterpoint did not publish total unit numbers in its free release, only percentages and market shares.

Winners and losers by brand

Counterpoint's preliminary figures show the biggest brands taking very different hits:

• Samsung: top with a 23% share. Shipments fell only 3%, helped by early demand for the Galaxy Z Fold8 and steady parts supply for its mid-range A series.
• Apple: 22% share, the first time it has passed 20% in any third quarter, even though its shipments fell. Counterpoint links the fall partly to the absence of a base iPhone 18 at launch.
• Xiaomi: shipments down more than 30%, with share falling to 10%. It deliberately cut back on cheaper models and some overseas markets.
• OPPO (including OnePlus and realme) and vivo: both down more than 20%, at 9% and 8% share. Both raised prices on entry-level and mid-range phones.

By our calculation, the top five brands held about 72% of shipments between them, leaving roughly 28% for everyone else. Shares are rounded, so treat that as approximate.

The pattern is clear. Brands that sell mostly expensive phones held up; brands that rely on budget models fell hardest. Counterpoint calls it “a widening gap between premium and price-sensitive segments.”

How other trackers compare

No second firm has published Q3 numbers yet, so the 20% figure cannot be cross-checked directly. Earlier data from IDC points the same way, with differences in degree.

In July, IDC reported that shipments fell 6.7% in the second quarter to 277.5 million units. Samsung and Apple were the only top-five brands that grew. IDC's Nabila Popal said memory costs were “up nearly 300% from a year ago”.

In August, IDC forecast a 16.7% fall for the whole of 2026, to just over 1 billion units. It expects second-half shipments to drop 27.2%. That is steeper than Counterpoint's Q3 estimate, but it is a different firm, method and time period, so the two are not directly comparable. IDC's and Omdia's own Q3 estimates may differ from Counterpoint's when they are published.

What it means if you are buying a phone

Counterpoint's release says phone makers pushed global retail prices up 20% so far in 2026. Its September 3 price tracker gave more detail, though with a lower figure at that time. It said existing models were 15% dearer on average and new launches 25% costlier than the models they replaced.

Where you live matters. In that September tracker, prices rose 21% in India, 19% in Asia Pacific and 18% in the Middle East and Africa. The increases were 10% in China, 7% in Europe and 5% in the US.

Counterpoint also found phone makers trimming specs to hold prices, with “lower storage capacities, reduced camera configurations” and more 4G models. With that in mind, a few practical steps:

• Read the spec sheet, not just the price. A new model at the same price may have less storage or a weaker camera than last year's.
• Compare against last year's model. New launches were 25% costlier, according to Counterpoint's September tracker.
• Consider refurbished. Counterpoint says more buyers are doing so. If you are in India, our comparison of a new Android phone versus a refurbished iPhone walks through the trade-offs.
• Use trade-ins and big sales events carefully. Counterpoint says financing and trade-in deals are cushioning higher prices, and that buyers are timing purchases around sales.

The catch: early numbers, one source

These are preliminary estimates from a single firm, and they measure shipments into the sales channel, not phones bought by consumers. Counterpoint's figures can be revised when its final data comes out.

The price figures need care too. The October release says retail prices are up 20% this year, but it links to the September tracker, which said 15% at the time. The difference may reflect further rises since September, but Counterpoint does not explain it.

Nor does anyone know when this ends. Counterpoint says a meaningful recovery “is unlikely until component costs and supply conditions improve.” IDC said in August that it expects memory prices to keep rising until at least 2028. Forecasts like these have changed quickly this year.

Frequently asked questions

Why are smartphone shipments falling so sharply?

Counterpoint says soaring DRAM and NAND memory prices raised the cost of building phones and caused supply shortages. Reuters reports that AI infrastructure projects are cornering memory supplies.

Which phone brands are doing best?

Samsung (23% share, shipments down 3%) and Apple (22% share) gained share. Xiaomi, OPPO and vivo each lost more than 20% of their volume.

Will phones get cheaper soon?

No source we checked expects that in the near term. IDC expects average selling prices to keep rising into 2027, and Counterpoint sees no meaningful recovery until component costs ease.

For now, the smartphone market is shrinking in units while getting more expensive per phone. If your current handset still works well, holding on to it is exactly what Counterpoint says many people are doing.