Despite a poor global smartphone market during Q3, the iPhone achieves something it never did before

An absolutely horrific third quarter resulted in a 20% year-over-year decline in smartphone shipments, according to Counterpoint Research. The decline was caused by memory chip shortages, which led to higher prices. On the other hand, both Samsung and Apple stood out during the three months and even increased their market shares year-over-year.

Apple and Samsung battle it out at the top

Apple's 22% market share placed it second, just behind Samsung's leading 23% slice of the global smartphone pie. But Apple's results were even more amazing since it was the first time in the history of the iPhone that the device garnered a better than 20% market share during the third quarter.

That this record took place during such a poor quarter bodes well for Apple and also for Samsung. The latter took advantage of strong early demand for the Galaxy Z Fold to record a strong quarter.

Just how bad was Q3 2026 for the smartphone market? Consider that Apple reported that 22% market share even though it reported fewer iPhone shipments on a year-over-year basis. Why was the overall market so bad? It all goes back to a little story that we've discussed several times that stars tech's current bogeyman: Artificial Intelligence.

AI Data Centers bring on demand for HBM chips, creating the DRAM shortage

Due to demand for more advanced memory chips for AI data centers (including demand for them from the data centers probably being built in your backyard), the companies that manufacture RAM chips for smartphones (Samsung, SK Hynix, and Micron) have stopped building as many DRAM chips as they usually do.
Instead, the trio have been building the aforementioned memory chips for AI data centers known as High-Bandwidth Memory (HBM). These components carry much higher profit margins and are in very strong demand. It's an easy decision for memory chip manufacturers to make, especially if they concentrate only on their bottom lines. 

Yes, this is all great news for the purveyors of memory chips, but it is bad news for smartphone manufacturers and consumers. The former end up paying more for harder-to-find DRAM chips and are forced to hike prices of their new phones. Consumers are left holding the bag as they pay more for new handsets.

Some phone manufacturers have kept prices steady by reducing the amount of RAM in some models, or in other cases a previously greenlit hike in RAM has been delayed. The result? The industry had its lowest Q3 shipments since 2012, the year that Apple released the iPhone 5.

Which firms come after Samsung and Apple?

Samsung and Apple were numbers one and two with Q3 market shares of 23% and 22%, respectively. Xiaomi was third with a 10% market share, followed by Oppo's 9%, Vivo's 8% and the "Others" catch-all with a 27% market share.

Let's compare the 2026 second quarter with the same quarter for 2025. The 1% paper-thin margin between Samsung and Apple was still 1%, but instead of Samsung at 23% and Apple at 22%, the numbers were Samsung at 19% and Apple at 18%. Xiaomi was still in third, but with 14% of the market instead of this year's 10%. Oppo and Vivo were numbers four and five, same as this year, but with market shares of 12% and 9%, up from this year's 9% and 8%, respectively.

Earlier in this article, I pointed out how Apple was able to report strong global third-quarter numbers despite lower year-over-year iPhone shipments for Q3. That shortfall might be due to Apple's decision not to ship the iPhone 18, iPhone Air 2, and the iPhone 18e until early 2027.

What to look out for in Q4

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