AI’s lust for memory drags down the smartphone industry, and Qualcomm with it

Qualcomm has warned that soaring memory prices will mean the smartphone industry will slow, news that so spooked investors they sent the company’s share price sliding by 11 percent.

CEO Cristiano Amon opened the chip design firm’s Q1 2026 earnings call with news of $12.3 billion revenue, a company record, which he said came thanks to strong sales of premium smartphones and growing interest in smart glasses, automotive, and Internet of Things products.

But he quickly turned pessimistic by warning “In the coming quarters, the handset industry will be constrained by the availability and pricing of memory, particularly DRAM.” Those constraints, he said, stem entirely from memory-makers prioritizing memory for AI datacenters and reducing the amount of other memory they make. The laws of supply and demand have kicked in, sending the price of DRAM soaring.

Amon said “several” handset-makers, especially in China, are therefore “taking a ...