Smartphones bet on experience as memory chip prices surge

Smartphone memory prices jumped more than 80 percent quarter-on-quarter in the second quarter of 2026, with DRAM overtaking chips to become the single most expensive component in flagship phones, according to market research company Counterpoint Research.

The cost impact is expected to persist into the second half of 2027, Counterpoint Research said.

Rising costs are colliding with relatively weak demand. Data from the China Academy of Information and Communications Technology shows domestic phone shipments reached 133 million units in the first half of 2026, down 5.5 percent year-on-year.

Against this backdrop, manufacturers are pursuing differentiation. iQOO has unveiled its next-generation self-developed gaming chip, the Q4, alongside its latest iQOO 16 gaming phone. The device pushes mobile gaming onto larger screens, allowing more PC games to be played on the go.

The dual pressure of component costs and soft demand is forcing brands to compete on experience rather than price alone, with gaming performance emerging as a key battleground, experts said.