Memory prices soar, Goldman Sachs lowers global smartphone sales forecast, mid-to-low-end unable to hold on first

The price increase of storage chips is a "double-edged sword" that is piercing the recovery bubble of the global smartphone market. According to information from Chasing Wind Trading Desk, a team of Goldman Sachs analysts led by Allen Chang warned in their latest research report released on January 25 that the surge in storage component prices has led to skyrocketing costs, and the anticipated rebound in smartphone shipments for 2026 will no longer exist. Goldman Sachs directly lowered its global smartphone shipment forecast for 2026 by 6%, expecting only 1.19 billion units for the year—this means that the market will not only fail to grow that year but will instead shrink by 6% year-on-year. The logic behind this judgment is very straightforward: storage chips are too expensive, leading to a surge in the BOM (Bill of Materials) cost of smartphones. This is almost a devastating blow for price-sensitive low-end models. Rising Storage Prices "Eat Up" Demand in the Entry-Level Market Why is the impact of rising storage prices on sales so significant? Goldman Sachs did the math: in low-end models, the proportion of storage chips in the BOM cost is extremely high. When memory becomes expensive, manufacturers either raise prices or endure losses. In emerging markets, consumers are extremely price-sensitive. Once entry-level smartphones (priced below $200) raise prices to cover costs, demand will evaporate instantly. Goldman Sachs predicts that from 2025 to 2027, global entry-level smartphone sales will continue to shrink at a compound annual growth rate (CAGR) of -4%, with its market share dropping from 44% in 2024 to 40% by 2027. This has led to a typical "volume drop, price rise" situation: although global shipments for 2026 and 2027 have been revised down to -6% and +2%, respectively, due to the passive increase in average selling price (ASP) and changes in product structure, the total market value (TAM) of global smartphones can still maintain slight growth (expected to grow by 2% to $581 billion in 2026). High-End Models and Foldable Screens: The Rich's Game Remains Unaffected In stark contrast to the low-end market's woes, the high-end market (priced above $600) is almost immune to this wave of cost shocks. The reason is simple: for iPhones or Android flagships priced over $600, the cost of storage chips accounts for a relatively low proportion of the total price, and the target customer base is not sensitive to price. Goldman Sachs expects that high-end model sales will maintain a 2% CAGR from 2025 to 2027, and by 2027, high-end models will contribute 70% of global smartphone revenue. Foldable smartphones are a bright spot in counter-cyclical growth. The release of new products like the Huawei Mate X7 and Moto Razr is attracting users through new forms and more mature supply chains. Goldman Sachs predicts that the global penetration rate of foldable smartphones will reach 3.8% (about 45 million units) in 2026 and further rise to 6.1% (74 million units) in 2027. Computing Hardware: AI Servers Soar, PC Recovery Stalled Outside of smartphones, the fortunes of the hardware market do not align AI training servers remain the growth engine. Goldman Sachs expects sales of AI training servers to surge by 56% in 2025, with a continued growth of 67% in 2026. In contrast, the recovery of general servers is much more moderate (expected to grow by 8% in 2026). The personal computer (PC) market has also been affected similarly to mobile phones. Goldman Sachs predicts that global PC shipments will decline by 5% in 2026, with a 3% rebound only expected in 2027. This indicates that, in the absence of compelling reasons for upgrades, high-cost hardware is suppressing the overall desire for upgrades in consumer electronics