2026-01-16
Memory Shortages Severely Impact H1 Capacity; China Smartphone P
Core Overview: Shaking Off First-Half Slump, Q3 Capacity Rebounds Strongly
According to the latest DataTrack forecast, China's smartphone production volume for the third quarter of 2026 (September) is expected to reach 190 million units (190,008 K pcs). This figure ends two consecutive quarters of low levels, representing a significant quarter-on-quarter increase of 14.69% compared to the 165.67 million units in the previous quarter (June 2026). Although the recovery momentum is significant, when observed from a year-on-year (YoY) perspective, the Q3 figure shows only a slight growth of approximately 1.08% compared to the 188 million units in the same period of 2025. This indicates that the overall market is still in a "bottoming out and recovering" phase and has not yet fully exploded.
Key Details: Memory Cost Pressure Leads to Drastic Correction in First Half
The most alarming aspect of the data is the "deep pit" in the first half of 2026. Looking back at the second quarter of 2025, production volume reached a peak of 201 million units, but the forecast for the same period in 2026 plummeted to 165 million units, a YoY decline of nearly 18%. The production freeze during this period reflects the extremely conservative inventory strategies adopted by Chinese brand vendors (such as OPPO, vivo, and Xiaomi) in the face of rising component costs. They significantly cut production of low-margin mid-to-low-end models, maintaining operations only for core flagship devices.
In-Depth Attribution: AI Server Crowding-Out Effect Ignites Shortage Wave
Market authorities Counterpoint Research and IDC point out that the main cause of hampered smartphone capacity in 2026 is the "memory crisis." As global chip manufacturers shift capacity priority to high-margin AI server memory (HBM/DDR5), the supply of DRAM and NAND Flash commonly used in smartphones has become severely tight, causing prices to soar. It is estimated that the Bill of Materials (BOM) cost for low-end phones has risen by 20-30% as a result, forcing manufacturers to cut orders in response, only being compelled to restart inventory pull-ins when the new device wave (such as iPhone 18) arrives in the second half of the year.
Outlook and Risks: Short-Term Pain, Long-Term Stability; Watch End-Market Price Hike Effects
Short-term (1-2 months): The supply chain will remain in a painful period of cost pass-through. Brand vendors may raise retail prices to reflect costs, and shipment volumes in the first half are expected to remain lower than the same period last year. Medium-term (3-6 months): Entering the traditional electronics peak season in Q3, combined with the launch of annual flagship devices from Apple and Android camps, production volume will rebound significantly to the 190 million unit level. However, the potential risk lies in the fact that if retail price increases are too large, it may suppress replacement demand in emerging markets, making the peak season recovery less robust than expected.
Online Search References
https://www.counterpointresearch.com
https://www.idc.com
https://www.telecomlead.com