Memory squeeze hits phones and PCs as shipments fall 20%

Global shipments of smartphones and personal computers both plunged by about 20% in the third quarter, as rising memory costs, constrained supply and earlier stockpiling squeezed manufacturers and weakened demand. The parallel declines point to a widening strain across consumer electronics, though the figures come from different research firms and should not be treated as one combined market total.

Counterpoint Research’s preliminary estimate put smartphone shipments down 20% year on year, at their lowest level for a third quarter since 2012. The firm attributed the decline to higher memory-chip costs and supply shortages that have pushed up device prices.

IDC estimated that PC shipments fell 20.1% to 62.7 million units, from 78.5 million a year earlier. Shipments were also down 9.1% from the second quarter, breaking the usual seasonal pattern in which the back-to-school period helps lift PC sales.

AI demand tightens supply

The pressure stems in part from competition for memory used in AI infrastructure. IDC has said strong demand for AI data centers is competing with consumer devices for DRAM and NAND capacity, while memory shortages and higher prices are expected to persist through 2026 and likely well into 2027.

PC makers and distributors also bought inventory early in the year to get ahead of expected price increases. That pulled orders forward, leaving fewer new purchases in the third quarter. At the same time, elevated component costs fed into finished-device prices and made buyers more cautious.

The downturn is visible across major PC brands: Lenovo shipped 14.9 million units, down 22.6% year on year; HP shipped 10.3 million, down 30.9%; and Dell shipped 7.6 million, down 25%. Apple and Asus also recorded annual declines, of 11.3% and 8.6%, respectively.

A difficult trade-off for makers

Manufacturers face a choice between absorbing higher component costs, raising prices or changing product specifications. IDC has warned that vendors may cut memory or storage in some configurations rather than pass through the full increase—an especially difficult trade-off for lower-priced devices, where margins are already narrow.

The two quarterly figures are a sharp snapshot, not proof that the markets will follow identical paths. But they show how the same supply-chain pressure is affecting both categories: fewer units shipped, higher costs and less room for manufacturers to protect demand without sacrificing margins or specifications.