India smartphone market hits five-year low: Phones under Rs 10,000 are fast disappearing

If you are planning to buy a smartphone in India, getting more features for less money will soon become harder, and we have already started to see the signs. Rising memory costs are pushing handset prices higher even as demand weakens, forcing brands to rethink what they sell at the lower end.

India's smartphone shipments fell 11.1% year-on-year to 33.2 million units in Q2 2026, according to IDC. That made the first half of 2026 the weakest first half for the market in five years. The average selling price also rose 14.4% year-on-year, showing how higher costs are changing the market.

Budget phones take the biggest hit

The pressure is particularly severe at the entry level. IDC's Q1 data showed shipments of smartphones priced below $100 falling 59% year-on-year, with their share dropping from 18% to 8%.

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For you as a buyer, rising DRAM and NAND memory costs are making inexpensive smartphones harder for manufacturers to sell profitably. Brands are cutting discounts, raising prices and shifting their portfolios towards more expensive devices.

The change is also visible across major brands. Vivo remained India's largest smartphone brand, but its Q2 shipments fell 13.9%. Xiaomi, Oppo and Realme declined 10%, 8.5% and 14.2%, respectively. iQOO suffered an even sharper 61% drop.

4G phones make a comeback

One unexpected effect is the return of cheaper 4G smartphones. Their share of India's smartphone shipments increased from 5.8% in Q1 to 11.1% in Q2, as manufacturers brought back lower-cost models to offset rising prices of entry-level 5G phones.

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Samsung, Apple lead the smartphone market

As per the report, Samsung and Apple managed to buck the broader downturn. Samsung's shipments grew 0.4%, while Apple's rose 0.7%, taking their market shares to 16.4% and 8.5%, respectively. Motorola and OnePlus also performed relatively better than several other major brands.

Your buying habits are changing too. Online shipments fell 19.8%, while offline shipments declined just 3.6%, lifting the offline channel's share to 58.1%.

The squeeze on cheaper phones is not entirely new. IDC's global outlook has already warned that the sub-$100 segment is becoming economically unviable as memory prices remain structurally higher. The company expects India's smartphone shipments to fall by more than 15% in the second half of 2026, suggesting that the affordability problem could deepen before it eases.