There Probably Won’t Be Many Budget Phones Next Year

AI demand has been causing memory shortages for some time now, but by 2027, its effects are expected to reach the budget smartphone market. The DRAM market is tight, which could keep prices high through next year, making phone makers reconsider their lower-end models.

Samsung, one of the largest memory suppliers, has already sharply raised its component prices. DRAM and LPDDR prices saw an 81% quarter-over-quarter jump in Q12026, followed by what’s projected to be another 58-63% in the second quarter and 20% in the third. These hikes directly drive up the costs of smartphones, PCs, and anything else that relies on RAM.

Per a new report from Wccftech, the smartphone industry could see its largest shipment decline yet in 2026, with one forecast projecting a 13% decline driven mainly by the RAM shortage. Rising memory costs hurt budget phones the most because margins are thin and brands have limited room to absorb higher component prices.

If AI hardware continues to take a growing share of DRAM output, brands may cut ultra-low-end models, raise prices, or push users toward mid-range AI-ready phones instead.