Starting in 3Q25, memory prices are expected to experience a significant surge, with this upward trend projected to persist through at least 1Q26. This rally is substantially inflating Bill of Materials (BOM) costs and forcing increases in end-device pricing. Consequently, TrendForce has further downgraded its forecast for 2026 global smartphone production volumes; should costs continue to rise or economic conditions deteriorate, the year-on-year decline may expand further. Future market trends will be subject to rolling adjustments based on brands' strategies regarding margin absorption, price fluctuations of other components, the extent of specification downgrades, and price sensitivity across various segments. Notably, entry-level products currently face the most severe pressure and risk of elimination.

Key Highlights

• Memory Price Surge: Memory prices are projected to rise sharply starting 3Q25, with this strong rally expected to persist through at least 1Q26, causing significant volatility in the smartphone market.
• Impact on Costs: Soaring memory prices are driving up Bill of Materials (BOM) costs, necessitating upward adjustments in end-device retail prices.
• Production Forecast Downgrade: TrendForce has revised its 2026 global smartphone production forecast downward to a 3.5% year-on-year (YoY) decline, with the possibility of the decline widening to 5% under a pessimistic scenario.
• Market Outlook: While general market sentiment fears a potential 10–15% decline, TrendForce has refrained from adopting the most bearish outlook at this stage, citing supporting factors such as replacement demand, growth in emerging markets, and the capacity for brands to absorb partial cost increases.
• Key Variables & Risks: Future market performance will depend on the extent of brand margin absorption, cost trends of other components, the pace of specification adjustments, and price tolerance across different segments. The entry-level price segment faces the highest risk.

Table of Contents

1. Key Points
2. Updates on Smartphone Market
   • 2026 Global Smartphone Production – Latest Revised Projection
   • Estimated Production of Top 8 Smartphone Brands

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