In what is nothing short of a huge shocker, TrendForce has just reported that memory costs continue to escalate rapidly, and currently constitute nearly half of a given smartphone's Bill of Materials (BOM). In this melee, Apple remains relatively insulated for now after having instituted a series of cost management steps.
TrendForce: "Memory, which historically accounted for around 10–15% of a smartphone’s BOM, has now surged to 30–40%"
In a hard-hitting report, TrendForce has just reported that the cost of a typical 8GB+256GB memory configuration has surged by nearly 200 percent year-over-year in Q1 2026, roughly tripling from the same period last year.
As such, while memory costs historically accounted for only 10 percent to 15 percent of a given smartphone's BOM, they now make up between 30 percent and 40 percent, and are rapidly closing in on the 50 percent mark.
Consequently, under the bear-case scenario laid down by TrendForce, the total output of smartphones in 2026 is projected to decline by 10 percent year-over-year to approximately 1.135 billion units. In the worst-case scenario, however, the global contraction in smartphone production could eclipse the 15 percent mark.
TrendForce does take pains to note that "Apple, which shares the top market position, is comparatively better positioned to absorb higher memory costs due to its higher proportion of premium models. Its customer base also shows greater tolerance for price increases, providing partial support for production stability."
In fact, we noted earlier this week that, as per new supply chain checks by GF Securities analyst Jeff Pu, Apple has already implemented a number of cost control measures to prevent a price hike for the iPhone 18 variants.
As we've noted repeatedly, Apple is likely to bifurcate the launch of the iPhone 18 lineup, with the Pro and Pro Max models launching this fall, while the volume-heavy base iPhone 18 and iPhone 18e debuting in the spring of 2027. By doing so, Apple hopes to curb the ensuing cost pressures related to the constrained DRAM supply and the pricey 2nm-based A20 chip.
According to the GF Securities analyst, Apple's goal is to keep the starting selling prices of the iPhone 18 Pro and Pro Max "unchanged or at a similar level" to those of their iPhone 17 counterparts. This means that the iPhone 18 Pro is likely to launch at $1,099 this fall, while the iPhone 18 Pro Max would break the bank at $1,199.
Coming back, TrendForce also believes that "Huawei is likely to experience the smallest production adjustment under the bear-case scenario, and could even post growth against the broader market trend." The report identifies Huawei's strong brand loyalty and unique market position in China as the leading factors for this projection.
About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.
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