Rising memory prices curb next year's smartphone output, eased by pulled and downgraded parts; server demand props up quotes, but ample consumer inventory leaves trading thin.
Agentic AI elevates memory as LPDRAM shifts to servers, squeezing smartphones and widening the gap for smaller brands.
AI servers continue to crowd out DRAM capacity, driving a supply-demand imbalance and price hikes that will persist into 2027. Impacted by skyrocketing component costs, global smartphone shipments are expected to contract further. To manage cost pressures, brands are adjusting pricing and production strategies, while entry-level markets may adopt salvaged and downgraded materials to sustain operations.
Surging memory prices have triggered early purchasing, driving a short-term recovery in smartphone production this year; however, this pull-in effect will exacerbate market deterioration next year. Constrained by a high base and rising buyer inventory levels, the growth rate of Mobile DRAM contract prices is narrowing in the third quarter. As original manufacturers shift production capacity toward server DRAM and high-bandwidth memory (HBM), prices are projected to enter a period of high-level consolidation by year-end, with supply remaining tight into next year.
New CEO Ternus leads Apple's first foldable launch; modest specs upgrade amid surging memory costs puts pricing and AI delivery at center stage.
Rising memory costs triggered premature purchases as consumers sought to beat price hikes, driving a short-term rebound in smartphone production and prompting TrendForce to revise its full-year output forecast upward. However, this momentum reflects front-loaded demand rather than a genuine market recovery. As persistent cost pressures trickle down to end-user pricing, entry-level models are set to disappear, leaving the market vulnerable to structural contraction risks ahead.
Mobile DRAM revenue surged sharply in 2Q26; four vendors dominate. Growth will moderate in 3Q26 as price gains slow.
TrendForce revises 2026 smartphone output upward, driven by demand pull-forward, not recovery; rising DRAM costs in 2027 risk deeper market contraction.
A sharp spike in the BOM cost of Apple's next-generation flagship has forced even the highly profitable US tech giant to raise retail prices in response. By comparison, the situation is even more precarious for the Android camp, which has a much lower tolerance for rising component costs. This cost storm will not only impact short-term pricing for new models but could also reset the price benchmark for the entire industry. Subsequent developments warrant close observation.
In 2027, supply–demand dynamics for DRAM and NAND Flash are expected to diverge. On the one hand, strong pull ins from AI servers will further widen the supply gap for DRAM. On the other hand, for NAND, weak consumer side demand combined with higher bit output driven by process migrations is likely to push the sufficiency ratio from negative to positive, placing downward pressure on prices in 2H27. However, if only NAND prices correct, the overall relief on total component costs for consumer products will remain quite limited. Overall, the pricing trajectory in 2027 still carries a high degree of uncertainty.
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