Global smartphone shipments fell 6.7% year over year to 277.5 million units in the second quarter of 2026, as soaring memory chip prices squeezed budget phone makers and widened the gap between premium and low-cost brands, according to research firm International Data Corp. (IDC).
The decline is the second straight quarter of falling shipments, highlighting how increasing component costs continue to weigh on the industry despite steady consumer demand for high-end smartphones.
IDC said memory prices have increased by nearly 300% from a year ago, making it much more expensive to build entry-level smartphones.
“Memory costs are up nearly 300% from a year ago, and now account for over 65% of BOM at the low end, making survival increasingly difficult for OEMs with low-end portfolios,” said Nabila Popal, senior research director for Worldwide Consumer Devices at IDC.
She said the slowdown is not affecting all smartphone vendors equally.
“Q2 confirms exactly what we predicted: this is not a uniform downturn; memory crisis is favoring premium players and punishing vendors exposed to the low end. For the second consecutive quarter, Apple and Samsung showed resilience as the only two vendors in the Top 5 posting growth.”
Samsung remained the world’s largest smartphone vendor, shipping 62.7 million units during the quarter, up 8.1% from a year earlier. Apple followed with 55.8 million units, posting the fastest growth among the top five vendors at 15.3%.
IDC said Apple benefited from strong demand for the iPhone 17 and consumer concerns over possible price increases. The research firm expects Apple to reach a record 22% global smartphone market share this year.
Chinese smartphone brands continued to struggle. Xiaomi shipments fell 26.3% to 31.2 million units, while OPPO dropped 17.5%, and vivo declined 19.4%.
“The second quarter of 2026 brought a widening gap between the top and bottom of the market. Samsung and Apple both grew shipments and widened their lead, lifting their share by 3.2 and 3.8 percentage points, respectively,” said Francisco Jeronimo, vice president for Worldwide Client Devices at IDC.
He added that this memory crisis has split the smartphone market in two. He noted that at the top, Apple and Samsung are pulling away because they secured supply early and sell where memory is a smaller share of the bill of materials (BOM). At the bottom, the vendors exposed to cheap, high-volume devices are absorbing the pain, and so are their customers. This is a crisis that rewards scale, supply relationships, and a premium mix.
IDC said brands that depend heavily on smartphones priced below $200 are under the most pressure. Many are extending the life of older models or bringing back 4G versions to keep prices affordable while managing higher production costs..
Huawei was the exception among major Chinese vendors. The company posted 20.9% year-over-year shipment growth by keeping prices stable in China while competitors raised prices, running targeted promotions, and expanding its product lineup.
For markets such as the Philippines, where affordable Android smartphones account for a large share of sales, prolonged memory shortages and higher component costs could eventually translate to higher retail prices or fewer new budget models.