India's smartphone shipments declined 10% year-on-year in the April-June quarter, marking the sharpest quarterly decline in six years since the January-March period of 2023, according to Counterpoint Research. The mass-market segment bore the brunt of this slowdown, with smartphones priced below ₹15,000 experiencing a dramatic 45% plunge from the previous year. As reported by TechCrunch, this decline represents the clearest sign yet that the AI infrastructure buildout is now visibly reshaping consumer electronics in the world's second-largest smartphone market. IDC also expects India's smartphone shipments to decline by double digits in Q2, a steeper fall than the 4.1% decline in the first quarter and the 5.3% drop in the previous quarter, though IDC's estimates are not yet finalized.
The sharp decline was primarily driven by memory chip shortages and elevated prices that pushed handset prices up 4-68% depending on the model, according to Counterpoint Research. As reported by TechCrunch, smartphone prices in India have risen by between 4% and 68%, depending on the model, with the impact flowing through to Indian shelves faster than anywhere else. Samsung, SK Hynix, and Micron have shifted capacity toward high-bandwidth memory used in AI accelerators because the margins per wafer are far higher than on standard mobile memory. This capacity diversion has left less capacity and higher prices for the RAM and storage components that go into phones and laptops, with the impact flowing through to Indian shelves faster than anywhere else. India's market is bottom-weighted, with roughly 60% of sales in the sub-₹20,000 segment, where a $20 rise in bill-of-materials cost is the difference between a sale and a delay. Smartphone memory prices have increased nearly 4x since September 2025 and are expected to rise further, potentially reaching 5x in the coming months, as noted by Counterpoint Research.
The sharp slowdown particularly impacted Chinese smartphone brands, which remain heavily dependent on entry- and mid-range devices. As reported by Counterpoint Research, their combined market share fell to its lowest level for a second calendar quarter since 2020. This decline reflects the broader market weakness in affordable segments that Chinese manufacturers traditionally dominate, with the pain concentrated at the entry level as shipments in the sub-₹15,000 segment fell 45% year-over-year. According to TechCrunch, China accounted for 74% of OnePlus's global smartphone shipments to distributors and retailers in Q1, up from 59% a year earlier, while India's share fell to 19% from 30%. OnePlus announced this week it would stop launching new products in Europe and North America, while maintaining its India business, following what it described as a careful assessment. Vivo leads with 17.8% market share, which itself is a significant drop from the 19.2% share in Q2 2025, while Samsung is at a very close second with 17.6% share (up from 15.5% year on year).
Despite the overall market decline, Samsung was the only major brand to post growth in India in Q2, up 2% year-over-year, as reported by AI Chat Daily. Apple shipments fell 3%, with its market share now at 7%, as noted by Counterpoint Research. While consumer demand for the iPhone 17 series remained strong, persistent supply constraints and inventory shortages across online and offline channels limited the brand's shipment growth during the quarter. According to TechCrunch, consumers buying higher-end smartphones have proved less sensitive to price increases, with financing making expensive devices more affordable. Financing has meanwhile become 'central to affordability', as noted by Kiranjeet Kaur, associate research director for mobile phones research at IDC. Xiaomi, including Poco, and Realme both recorded falls in sales as repeated price increases across their affordable portfolios weakened consumer demand. In contrast, Oppo relied on stronger demand for devices priced above ₹20,000 to cushion the slowdown in the mass-market segment, demonstrating the effectiveness of premium positioning during challenging market conditions. Google emerged as the fastest-growing smartphone brand in the ultra-premium segment (> ₹45,000 price) in Q2 2026, posting 68% YoY growth for its Pixel phone portfolio.
Replacement cycles have stretched from about 3.5 years to roughly four years as buyers delay upgrades, according to Counterpoint Research. The Indian smartphone market is shifting from volume-led growth to value growth — meaning fewer phones are being sold overall, but each one generates more revenue as higher component costs make lower-priced smartphones increasingly uneconomical, as noted by Kiranjeet Kaur at IDC. There isn't much good news awaiting the smartphone market over the horizon too, with Counterpoint expecting India's smartphone market to remain under pressure through the rest of the year, as elevated memory and component costs continue to keep device prices high. Memory shortages and elevated smartphone prices are likely to persist until at least the end of 2027, although the pace of price increases should moderate as consumers gradually adjust to higher prices becoming the new normal, according to IDC. As H2 accounts for the majority of annual smartphone sales, OEMs are expected to focus on portfolio optimisation, financing-led affordability, and premium offerings to support demand. The India data represents the cleanest read yet on a second-order effect of the AI capex boom, with the market shifting from volume-led growth to value growth as profitability, not market presence, becomes the deciding factor.
