Omdia Forecasts 152 Million Drop in Smartphone Shipments in 2026

Global smartphone shipments are expected to decline sharply in 2026 as rising component costs, supply chain pressures, and geopolitical uncertainty force manufacturers to prioritize profitability over volume, according to new research from Omdia. 

Omdia’s latest global smartphone forecast projects that worldwide smartphone shipments will fall by 12.2% year-on-year in 2026, declining to 1.09 billion units. The forecast represents a reduction of approximately 152 million units compared with 2025 levels. Despite the decline in shipments, the research firm expects the total value of the smartphone market to increase by 6.1% during the same period.

The contrasting trends in shipment volumes and market value are being driven by a significant increase in smartphone prices. Omdia forecasts that the global average selling price of smartphones will rise from $467 in 2025 to $565 in 2026, representing a 21% increase and the largest annual rise recorded by the industry in both percentage and dollar terms.

According to the report, the price increases stem largely from rising component costs, particularly memory chips. Average prices for DRAM and NAND flash memory increased by more than 80% quarter-on-quarter during the first quarter of 2026, with additional increases recorded during the second quarter. Although price growth is expected to slow later in the year, component costs are likely to remain elevated, placing continued pressure on manufacturers.

Jusy Hong, Senior Research Manager at Omdia, said smartphone vendors are currently navigating a period of considerable disruption as they attempt to manage rising production costs. She noted that some manufacturers have gained advantages by increasing component inventories to reduce exposure to future price increases. According to Hong, the market is expected to begin stabilizing once memory prices plateau, with this transition likely occurring during the second half of 2027.

The report indicates that manufacturers are increasingly reducing their low-end product offerings and shifting their focus toward mid-range and premium smartphones to protect profit margins. This strategic adjustment is expected to affect regions differently. Emerging markets in Africa, the Middle East, and Latin America are likely to experience stronger declines in demand because consumers in these markets remain highly dependent on affordable devices and are particularly sensitive to price increases.

By contrast, developed markets are expected to prove more resilient because premium smartphones already account for a larger share of sales. Omdia noted that nearly all major smartphone brands, with the exception of Apple, have increased prices for their latest devices to offset higher manufacturing costs.

Runar Bjorhovde, Principal Analyst for smartphones at Omdia, said manufacturers are increasingly relying on broader product ecosystems and service offerings to improve resilience. He explained that vendors capable of generating additional revenue through connected devices, digital services, subscriptions, and ecosystem products will be better positioned to navigate the current market conditions.

Looking ahead, Omdia forecasts that the smartphone market contraction will continue into 2027, although the pace of decline is expected to slow considerably. The research firm believes that meaningful recovery in shipment volumes is unlikely before 2028, as the cost of producing entry-level smartphones is expected to remain elevated.

As a result, major global brands are expected to remain cautious about expanding their low-cost smartphone portfolios, while the ultra-budget segment increasingly shifts toward smaller regional and local manufacturers. For emerging markets, particularly in Africa, the report suggests that higher smartphone prices could slow device adoption and widen affordability challenges over the coming years.