Global smartphone shipments fell sharply in the second quarter of 2026 as a severe memory-chip shortage driven by artificial-intelligence demand forced manufacturers to raise handset prices.
Caixin Global reported suppliers have prioritised higher-margin AI data centers over consumer electronics, tightening memory supply and producing a cost squeeze that has particularly hurt budget-reliant Chinese brands while allowing premium heavyweights Samsung and Apple to solidify market dominance.
Manufacturers passed higher component costs to consumers, amplifying the market split between low-end vendors and premium players.
Analysts cited in the article expect the memory shortage to persist into 2027, clouding the industry's near-term outlook.
