Omdia warns smartphone prices may stay high despite RAM cost recovery

Technology market research firm Omdia revealed that in the first quarter of 2026, display panels shipped for the refurbished mobile market increased by 20 percent compared to the same period last year, reaching 298 million units. This marks the first time that refurbished panels surpassed those shipped to new smartphone manufacturers, which stood at 289 million units, highlighting the continuous growth in the second-hand device sector.

Omdia's definition of the refurbished market is not limited to second-hand devices sold to retail buyers, but also includes display panels entering consumer repair processes, professional recycling refurbishments, and aftermarket replacement parts. In terms of display technology, OLED panels accounted for 7 percent of refurbished display panels, up from 2 percent the previous year, indicating that premium smartphones from 3-4 years ago are circulating back to consumers.

Stock photo for illustration only, not from the actual event

This trend stems from soaring memory prices that drove up component manufacturing costs. Smartphone makers had to scale back production plans, causing display factories to miss projected order volumes. Omdia estimates that demand for new mobile displays will drop by 12 percent throughout 2026. Since display factories cannot rapidly cut production due to long-term capital investments, excess panels are being funneled into repair shops and smartphone parts markets.

For the overall new smartphone market in the second quarter of 2026, global shipments fell 6 percent to 272 million units from 288.9 million units a year earlier. The impact varied across brands: Xiaomi suffered the steepest drop at 26 percent down to 31.2 million units, as over half of its shipments fall under the sub-$200 segment which can no longer absorb rising component costs. Meanwhile, OPPO (including OnePlus and realme) dropped 17 percent to 28.4 million units after cutting budget models to protect profit margins, and vivo declined 18 percent to 21.5 million units.

Conversely, only Samsung and Apple managed to achieve growth. Samsung recorded 60.5 million shipments, up 5 percent with a 22 percent market share, aided by its internal memory production capacity, the delayed launch of the Galaxy S26, and capturing entry-level market share from budget Chinese brands. Apple shipped 55.1 million units, growing 23 percent to claim a record 20 percent market share for a second quarter. However, Omdia noted that this growth was partly driven by distributors aggressively stocking up on iPhone 17 units amid speculation that iPhone 18 prices will increase.

"Smartphone prices after the memory cost crisis are likely to remain at high levels because consumers have had time to adapt and get used to these prices."

Omdia

Stock photo for illustration only, not from the actual event

Omdia assesses that smartphone prices will remain elevated even after the memory cost crisis subsides, as consumers have grown accustomed to these price points, allowing manufacturers to maintain higher baseline prices. The market is entering a structural pricing phase where makers prioritize profitability over sales volume, with shipments expected to decline for another two quarters despite promotional efforts. To cope with high prices, brands are turning to installment services, bundled sales, and trade-in programs, creating a loop where brands must compete against their own refurbished devices. Furthermore, these cost pressures are spreading to wearable devices, as seen with price hikes on Samsung's Galaxy Watch.

Source: Thairath Lifestyle