Smartphone Market Faces 2026 Slowdown as Memory Chip Costs Soar: Report

• Global memory chip shortage expected to drive up costs by 40% in Jan-June, impacting smartphone production.
• Production costs (BoM) for handsets will rise 8-15%, leading to higher consumer prices and dampened demand.
• Entry-level smartphone shipments may decline over 5%, while mid and premium categories could fall 12-16% in 2026.
• Industry leaders like Xiaomi India's Sudhin Mathur and Lava India executives confirm price increases are unavoidable.
• Companies may resort to 'shrinkflation' (reducing specs at same price) to manage costs, limiting meaningful upgrades.

Why It Matters: Rising memory chip costs will lead to higher smartphone prices and a significant market slowdown in 2026.