According to IDC, the global smartphone market experienced its worst quarterly decline in history during the third quarter, with shipments falling by 22% year-on-year. Analysts attribute this downturn primarily to the rising costs of memory chips, which have surged by approximately 350% since last year.
The surge in memory prices, driven by high demand from the artificial intelligence sector, has squeezed profit margins across the industry. Manufacturers are responding by increasing retail prices, reducing hardware specifications, and discontinuing entry-level models to maintain profitability.
Chinese brands such as Xiaomi and OPPO have been hit particularly hard by these market conditions. In contrast, companies like Apple and Samsung Electronics have demonstrated greater resilience, supported by their extensive portfolios of high-end devices and established distribution channels.
IDC reports that the industry is undergoing a permanent structural shift. Projections suggest that the market will not see a recovery until at least 2028. As manufacturers continue to push consumers toward flagship and ultra-premium models, the overall market size is expected to shrink.
Nabila Popal, Research Director at IDC, noted that the market has yet to reach its bottom. With memory prices continuing to climb, the pressure on manufacturer margins and shipment volumes remains significant, indicating that the most challenging period for the industry is still ahead.
