Global smartphone market posts weakest third quarter in 14 years
Global smartphone shipments fall 20% from a year earlier in the third quarter, reaching their lowest level for the period since 2012 as memory shortages and higher component costs weigh on manufacturers. The decline reflects rising retail prices, tighter supply of memory chips tied to AI infrastructure demand, and weaker consumer replacement cycles.
Highlights
- Global smartphone market posts its weakest third quarter in 14 years as soaring memory costs and supply shortages curb production and shipments.
- Samsung maintains top market share at 23% despite a 3% year-on-year shipment decline, while Apple's share rises to 22% amid lower volumes.
- Xiaomi's market share falls to 10% after shipments drop over 30% as it reduces exposure to lower-priced devices and certain overseas markets.
Memory costs squeeze smartphone makers
As reported by Reuters, citing Counterpoint Research, soaring prices for memory components and supply shortages are raising production costs for smartphone makers and forcing them to cut shipments while prioritizing profitability over volumes.The research firm says AI infrastructure projects are absorbing memory supplies, adding pressure across the handset sector. Senior analyst Shilpi Jain says consumers are keeping their devices for longer, increasingly considering refurbished phones and shifting toward higher-value models.
Market leaders hold share as volumes decline
Samsung retains the top position in the global smartphone market with a 23% share, supported by demand for its Galaxy Z Fold8 series and stable component supplies for mid-range devices, even as its shipments fall 3% from a year earlier in the quarter.Apple's market share reaches 22%, topping 20% for the first time in a third quarter despite a year-on-year shipment decline. Counterpoint says the lack of a base iPhone 18 model leads to a smaller launch-month channel fill than the full iPhone 17 lineup a year earlier.
Among other major brands, OPPO and vivo record shipment declines of more than 20%. Xiaomi posts a drop of more than 30%, reducing its market share to 10% after cutting exposure to lower-priced devices and some overseas markets to protect margins.
Our earlier article on financing pressure in the AI infrastructure buildout explained that executives at Intel and Broadcom see access to capital and higher borrowing costs becoming a key constraint on data-center expansion. We noted that even if some hardware bottlenecks ease over time, investment will increasingly depend on proving clear economic returns from AI at scale, with memory supply-demand imbalances potentially lasting for years.
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