The smartphone market grew 1.9% in 2025 despite tariffs and economic pressures, with Apple and Samsung capturing 39% of global shipments. Premium devices drove the gains, but a looming RAM shortage threatens higher prices in 2026. Industry experts warn of potential market contraction unless supply issues ease.
In 2025, the global mobile phone industry achieved 1.9% year-over-year growth, bucking challenges from tariffs, economic instability, and consumer budget constraints, according to data from the International Data Corporation (IDC). Premium smartphones, those priced at around $800 or more, performed strongly, helping Apple and Samsung achieve the highest shipment growth rates. Together, the two companies accounted for 39% of all phones sold worldwide, an increase from 37% the previous year.
Looking ahead to 2026, the outlook shifts due to an intensifying shortage of RAM, a component already impacting the personal computer sector. This supply chain disruption, described as unprecedented, is expected to drive up costs and lead to a decline in smartphone shipments. "While 2025 was a positive year for smartphones, the industry is now facing a distinctly different outlook," stated Ryan Reith, IDC's group vice president for worldwide client devices. He added that "the memory shortage... will cause the market to decline in 2026, and the duration of the shortage will ultimately determine the extent of the market contraction."
Major tech firms like Apple and Samsung are better positioned to negotiate favorable supply terms, potentially shielding their margins. However, everyday consumers could face higher average phone prices as costs filter down. Manufacturers might employ strategies similar to those used against 2025 tariffs, such as delaying price adjustments or tweaking product specifications to soften the blow.
Avi Greengart, president and lead analyst at Techsponential, anticipates that companies will pass on costs selectively. "You'll see base phone models without quite as much storage as you might have gotten in the past, with higher prices being passed along on the larger storage options," he explained. Firms may also opt for cost-saving measures, like retaining previous-generation display technology instead of upgrading. Even entry-level and mid-range devices, with their thin margins, are unlikely to escape increases, while super-premium foldables—often nearing $2,000—offer more flexibility for price hikes.
As of early 2026, few new phones have launched without notable price jumps, leaving observers to watch events like Mobile World Congress in late February for clearer signals on the market's direction.
