Smartphone makers brace for lower volumes, higher prices, and deeper market split

Apple, Qualcomm, and MediaTek delivered similar warnings last week: the global smartphone market is entering a more expensive, more polarized phase. For users, this means fewer affordable options as component costs rise and chip prices increase. Qualcomm has reportedly notified customers that it will raise prices across its Snapdragon system-on-chip portfolio from September 2026, including its next flagship mobile platform. China's smartphone brands are bracing for a new round of cost pressure after Qualcomm reportedly notified customers of double-digit percentage price increases on products shipped from September 1. The price hikes reflect rising memory and component costs that are reshaping mobile chip pricing. Qualcomm is also raising prices approximately 15% on both its 4nm and 5nm processes for new customers as it pivots from mobile chips to custom AI data center chips. The smartphone market split is deepening, with premium devices gaining share while mid-range and entry-level segments face pressure from rising component costs. Qualcomm's CEO Cristiano Amon blamed rising memory and manufacturing costs for the price increases. The company completed its $3.9 billion acquisition of AI software firm Modular, appointing LLVM and Swift creator Chris Lattner as head of AI software strategy, signaling Qualcomm's pivot toward custom AI data center chips and AI compiler capabilities. This move aims to strengthen Qualcomm's AI compiler and software stack capabilities, filling gaps in cloud AI infrastructure and ecosystem.