Memory shortages are impacting cell phone sales, affecting companies like Qualcomm and Arm Holdings. Qualcomm expects revenue below estimates due to tepid orders and memory allocation issues. Arm faces potential dip in royalty revenues from smartphone chip sales. Supply shortage may persist until 2027, impacting consumer electronics market.

Shares of Qualcomm fell over 9%, while Arm dropped 3% in trading. Qualcomm CEO Cristiano Amon cited industry-wide memory shortage as a significant issue. Arm’s CFO Jason Child expects royalty revenues to drop by as much as 2% due to memory shortages. Analysts predict global smartphone chip shipments to decline in 2026.

Impact of memory shortages could extend through 2027, affecting supply pressures. Morningstar and J.P. Morgan analysts anticipate tight memory supply persisting into 2027. Global smartphone shipments are expected to decline, with rising memory costs limiting demand. Memory price increases may dim outlook for consumer electronics.

Qualcomm and Arm are diversifying into the data center market to reduce reliance on mobile phone chips. eToro analyst Zavier Wong sees memory constraints as an industry-wide issue. Both companies are exploring growth opportunities in high-margin sectors to mitigate impact of memory shortages.

Read more at Yahoo Finance: Qualcomm, Arm bear brunt of memory shortage as smartphone chip sales disappoint