Rising memory costs reshape smartphone economics

New dynamics, if not a structural shift, have been revealed in Assurant’s latest quarterly analysis of the smartphone trade-in market in the US, finding that rising memory costs are starting to reshape smartphone unit economics, while the first quarter of 2026 showed record Q1 revenues.

The Q1 2026 mobile trade-in and upgrade industry trends report found that after a record 2025, smartphone trade-ins, protection and a strong pre-owned smartphone market were helping consumers get more value from every device upgrade. It also showed how “simple” choices across the device lifecycle – such as trading in a smartphone instead of discarding it or leaving it in a cupboard – can create meaningful value for consumers.

Assurant said the data also highlighted a broader shift, whereby rising demand for refurbished smartphones is strengthening trade-in values and device condition is playing a larger role in determining value. It said protection plans were helping consumers maintain higher resale value and trade-ins were becoming central to how consumers upgrade.

Fundamentally, the survey showed that the first quarter of 2026 was the industry’s most active on record, based on volume of devices traded in and total value returned to consumers. In all, the data found that US consumers received $1.63bn from mobile trade-in programmes in the first quarter of 2026, up 31% compared with the same period in 2025. This was a market high for a first quarter, attributed by Assurant to higher device prices driving greater reliance on trade-ins and refurbished handsets.

The average age of traded-in devices held steady at 3.81 years, compared with 3.83 years for the full year of 2025. The iPhone 13 remained the most traded-in Apple model, while the Samsung Galaxy S23 Ultra led among Android devices. 

Looking specifically at the issue of memory, the study observed that the sharp rise in DRAM and NAND costs was pushing device prices up by 7% to 10% – in some cases, flagship devices were between $100 and $200 higher – with the net result of lengthening upgrade cycles, tightening affordability and accelerating demand for refurbished devices.

Devices in better condition were typically qualifying for higher trade-in values, with many consumers receiving up to 50% more than those with excessive wear or damage.

In response, Assurant reported that carriers were rethinking how they bundle protection, trade-in and upgrades to better manage cost and customer retention. One example cited was Xfinity Mobile’s new Plus Plan, which builds device repair and replacement directly into the monthly rate to deliver more predictable costs.

Assurant added that this also aligned with broader consumer demand, as shown in its latest Global connected consumer trends report, with 85% saying they were more likely to purchase devices with customisable coverage.

“As smartphone prices continue to rise, consumers are looking for smarter ways to manage upgrade costs – and trade-ins, especially when paired with protection, are playing a bigger role,” said Biju Nair, executive vice-president and president of Assurant’s global connected living business unit, commenting on the report.

“This data shows trade-ins are doing more than helping consumers save on a new device. They’re also supporting a growing market for high-quality refurbished smartphones, giving more people access to newer, reliable devices at a lower price and making it easier for consumers to access the full connected experience offered by premium device brands.”