Global smartphone market faces record annual decline as chip crunch worsens

Counterpoint Research warns the global smartphone market will see its steepest annual decline on record, forecasting shipments to fall 13.9% to 1.08 billion units in 2026 as a worsening memory-chip shortage — aggravated by the Iran war — squeezes supply. The downgrade from a 12.4% decline projected in February, rising wholesale prices (up 14% in Q1) and a 3.1% year-on-year shipment drop are prompting producers to shift capacity toward AI chips, hurting entry-level devices (many under $150 may disappear). Low- and mid-tier brands face the biggest hit (Transsion -32% forecast; Xiaomi and Honor also large declines), while premium players such as Apple and Samsung are more resilient (Apple shipments flat in 2026, expected +5% next year; Samsung ~-4% for 2026). The chip squeeze could accelerate consolidation at the budget end and boost market share for better-capitalized manufacturers.