Rising memory costs are about to test buyers' patience

"Counterpoint Research has revised down its 2026 smartphone shipment forecast to a 2.1 percent decline, citing a tightening supply of memory chips that is driving up costs and squeezing manufacturers. The analyst firm says higher DRAM and NAND prices risk undermining confidence across the market, particularly as smartphone vendors struggle to justify higher prices for devices that to many feel marginally different from the ones already in their pockets."

"Now the cracks are showing. Replacement cycles have stretched beyond 40 months on average, with users holding onto phones for much longer than manufacturers would like. For many, today's devices are already "good enough." Performance improvements are incremental, and software experiences change little from one generation to the next. Commodity memory costs are climbing as manufacturers prioritize higher-margin AI and datacenter products over traditional consumer silicon, and DRAM and NAND supply has tightened, leaving smartphone makers competing for capacity while hyperscalers and GPU vendors gobble up chips."

Counterpoint Research trimmed its 2026 smartphone shipment outlook to a 2.1 percent decline due to tightening memory supply and rising component costs. Higher DRAM and NAND prices are elevating bills of materials and pressuring manufacturers already facing stretched replacement cycles beyond 40 months. Consumers are holding phones longer because performance gains are incremental and software changes are modest. Memory makers are prioritizing higher-margin AI and datacenter chips, tightening capacity for consumer silicon while hyperscalers and GPU vendors consume supply. Memory prices could rise another 40 percent through Q2 2026, potentially pushing BOMs substantially higher and undermining market confidence.

Read at Theregister