In its latest ‘Global Smartphone SoC Model Shipments and Revenue Tracker, Q4 2025, Preliminary View’ report, Counterpoint predicts that the global smartphone SoC (System-on-Chip) market will slow down in 2026. This comes after posting growth for consecutive years. It adds that shipments could decline by 7% YoY. The rising memory prices are a major concern for the smartphone industry, and this will majorly impact the sub-$150 segment.
Transition from 3nm to 2nm process nodes
As foundries and memory suppliers are increasingly prioritizing high-margin HBM production to support the “rapid expansion” of support data centers, supply constraints and higher costs could hit the budget smartphone market. SoC vendors with significant exposure to 4G and entry-level 5G smartphones are expected to feel the heat in 2026.
Meanwhile, brands like Google, Huawei, Samsung, and Xiaomi are in a better position to navigate these market challenges. This is because of their investment in in-house SoC developments. The report notes that a full recovery in smartphone shipments is unlikely before 2027, as brands continue to make “short-term trade-offs, streamline their product portfolios, and explore cloud offloading strategies” amid ongoing memory supply constraints.
At the same time, the premium smartphone SoC players are entering a new phase from 3nm to 2nm technology in 2026. Samsung already announced its first 2nm Exynos 2600 SoC, opening a new chapter in the advanced semiconductor space. This chip will power the Galaxy S26 and S26+ in some markets.
Smartphone SoC market to reportedly record double-digit revenue growth in 2026
The report adds that despite near-term shipment pressures, the smartphone SoC market may deliver double-digit revenue growth in 2026. This growth will be driven by continued premiumization, higher memory prices, and the rapid adoption of AI-enabled features across smartphones.
Apple and Qualcomm could be the biggest beneficiaries of the ongoing premiumization trend. However, the report adds that it’s also seeing increasing efforts from MediaTek, which could intensify the competition over the coming years. Samsung is also gradually expanding premium adoption. Rising memory costs and weak mature markets will cap long-term smartphone shipments growth.
Having said that, the rapid rollout of GenAI capabilities is helping trigger demand and push device average selling prices (ASPs) higher. Counterpoint also adds that by 2026, peak on-device AI performance will reach around 100 TOPS. About 90% of premium smartphones will support on-device AI features. In contrast, the mid-range smartphone segment, priced between $100 and $500, may rely on cloud-based AI processing. This is to manage costs amid growing memory prices.
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