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India smartphone shipments fall 10% in Q2 as memory-driven price hikes crush budget segment
Our read
Budget segment stays gutted through 2026 as memory costs bite; industry offsets volume loss with EMI-fueled premiumization, confirming a further double-digit unit decline
For operators
Memory-driven cost inflation is crushing the sub-Rs 15,000 segment (-45%), so pivot volume toward EMI-financed mid-tier SKUs and lock in memory supply now before 2026's forecasted 13% decline bites deeper.
Watch
DRAM/NAND spot pricing and supplier guidance for H2 2026
The report,
India's smartphone shipments fell 10% YoY in Q2 as memory-driven component costs forced price hikes, crushing sub-Rs 15,000 sales 45%. Vivo led, Apple slipped 3%, financing/EMIs sustained premium demand; Counterpoint forecasts a further 13% decline in 2026.
Newer report , , Business Today : Rising memory costs squeeze India’s sub-₹10,000 smartphone market
Reported figures
From the report. Source details below
| memory prices up ~4x since Sept | 2025 |
|---|
Also in the report
- MediaTek 49% chipset share
- EMI >50% of mainline sales
Other figures
- 3% decline Q1
- avg price up ~15%
- Vivo 17.8% share
- Nothing +105%
Why it matters to operators
With memory now over 45% of BoM and EMIs above half of mainline sales, distressed budget-segment players and financing platforms become attractive consolidation or partnership targets heading into a contracting 2026.
What to watch next
- Festive-season (Diwali) shipment and sell-through data
- EMI/BNPL default and delinquency rates as financing exceeds 50% of sales
- Monthly share shifts among Vivo, Nothing, Xiaomi and Apple
- Government/PLI policy or tariff responses to component cost inflation
Likely next moves
Our read of what comes next — analysis, not reported by the source.
- OEMs cull sub-Rs 15,000 SKUs and reposition entry models with lower memory configs or aggressive EMI/no-cost financing
- Vendors negotiate long-term memory supply contracts and diversify sourcing to hedge component inflation
- Retailers and NBFCs expand EMI/BNPL penetration to preserve accessibility of higher-ASP devices
- Nothing and challenger brands press share gains in the mid-tier while incumbents defend premium
- Apple leans on trade-in, financing and retail expansion to arrest its 3% slip
The counter-case
The case against this reading — not reported by the source.
The narrative frames memory-cost inflation as the sole villain, but a 10% shipment drop with 15% higher ASPs may reflect a healthier revenue mix, not distress. If units fall but value rises and premiumization accelerates (Nothing +105%, EMI penetration >50%), the total addressable revenue could be flat-to-up—vendors and retailers may prefer this. The bear case for retail isn't shipments; it's whether the 45% budget collapse permanently removes first-time buyers who never re-enter, hollowing out the pyramid base that feeds future upgrades.
The source
Published
First seen