Global Smartphone Market Has Its Worst Quarter Ever, per Bloomberg
The worst quarter on record
The global smartphone market has had its worst quarter ever, per Bloomberg.
Global smartphone shipments fell 22 percent year over year in the September quarter to 255.3 million units, the worst decline of any quarter on record, per IDC. The researcher says the market has not reached the bottom yet, either.
AI demand is squeezing handset makers
The culprit is memory. Exploding demand from AI industry orders has cornered the supply of storage, and memory costs have surged approximately 350 percent since last year and are still rising, according to IDC.
The higher cost of storage has hurt profitability across the mobile sector and forced companies to raise prices, cut back specifications, and discard budget focused models, IDC said.
"Current indicators suggest that the market has not yet reached the bottom," said IDC research director Nabila Popal. "The worst is yet to come."
Premium brands take share of a smaller pie
Chinese brands including Xiaomi and Oppo took the worst hit among the top names, while Apple and Samsung fared better due to their larger premium handset portfolios, per IDC.
Separate estimates from Counterpoint Research put Xiaomi's shipment decline at more than 30 percent, with Oppo and Vivo down more than 20 percent. Samsung kept the top spot with a 23 percent market share despite a 3 percent shipment decline, and Apple's share reached 22 percent, crossing 20 percent in a third quarter for the first time.
IDC expects market growth to stay constrained through 2027, with any recovery pushed to 2028 at the earliest. Device makers, it says, increasingly recognize they face a permanent structural shift in industry cost dynamics, and the long term trend favors vendors with premium lineups and large scale distribution.
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Options market and stocks to watch
A shrinking handset market with rising component costs splits the trade in two. AAPL is the relative winner, gaining share at the premium end where margins hold up best, while Android volume names face the squeeze.
The flip side of the shortage is memory itself. MU sells the DRAM and NAND whose prices have surged, so the same cost shock crushing handset makers is a pricing tailwind for memory suppliers. QCOM sits in the middle, exposed to Android unit volumes across the price tiers being cut.
Watch call and put flow in MU for signs traders are pressing the shortage trade, and in AAPL into its next earnings for premium demand resilience. Follow tech names on the Unusual Whales news feed.
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