A.I. Is Eating the Smartphone: Shipments Plunge 22 Percent
Trending Topics Jakob Steinschaden ● Covered by 7 sources
Global smartphone shipments fell 22% in Q3 to 255.3 million. AI data centers are driving a memory-chip crunch, and phones are getting pricier.
Based on reporting by Trending Topics, Jakob Steinschaden — read the original for the full story.
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A new squeeze from the AI boom just hit the smartphone market. Global shipments dropped 22% in the third quarter to 255.3 million devices, according to IDC, the steepest fall it has ever recorded. A year earlier, the figure was 327.3 million.
IDC blames what it calls an “A.I.-led memory crisis.” AI data centers are consuming huge amounts of memory, and that has pushed memory chip prices up by about 350% from a year ago. For phone makers, that hurts twice: the parts cost more, and there’s less of them to go around. The strain was already showing up elsewhere, including Apple’s MacBook Air.
The decline has been getting worse through the year. Shipments fell 2.9% in the first quarter, then 7.4% in the second, before this much sharper drop. Now the pressure is landing on buyers. Francisco Jeronimo, a vice president at IDC, said the squeeze is moving from vendors to consumers, and that people are keeping their phones longer as a result.
The pain is not spread evenly. Chinese brands, which lean heavily on price-sensitive buyers, have been hit hardest. Apple and Samsung have held up better and even gained market share, with shipments of 57.3 million and 57.8 million respectively. Prices are climbing too: Apple reportedly raised the price of its new iPhone 18 Pro models by $100, and Samsung did the same for its Galaxy S26 lineup.
IDC does not see a quick recovery. Nabila Popal, an analyst there, said “the worst is yet to come” and that the market has not bottomed out. The firm has already cut its full-year forecast three times, most recently to a decline of 16.7%, and now expects another drop in 2027 before a recovery only from 2028. Counterpoint Research, meanwhile, puts the third-quarter fall at 20%, which is a little less grim but still not exactly a victory lap.
My take — AI-written commentary, not fact-checked reporting
This is the part of the AI boom that gets waved away until it starts wrecking boring, giant markets like phones. The industry spent years pretending memory was somebody else’s problem; now it’s everybody’s problem. And if Apple and Samsung are raising prices while smaller Android brands get squeezed, that’s not a healthy market — that’s a bill coming due.
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