India's Smartphone Shipments Fall 20% in Q3 as Memory Costs Hit Decade Low

Smartphone manufacturers also held back on channel inventory amid persistently subdued demand, even ahead of the festive season, the report said.

The impact was particularly severe in the sub-₹20,000 segment, where shipments plunged 47 per cent during the quarter. Rising prices pushed several devices into higher price bands, further straining affordability among mass-market consumers.

“Rising component costs pushed device prices higher, putting increasing pressure on affordability and weakening the traditional mass-market volume engine, particularly below ₹15,000,” Research Analyst Shubham Singh said.

Counterpoint Research expects India’s smartphone market to contract by around 13 per cent in 2026, with higher prices continuing to weigh on affordability and replacement demand, Research Director Tarun Pathak said.

The slowdown following the festive season is expected to add to the pressure. Elevated component costs could also trigger another round of price increases after festive sales, further challenging manufacturers’ efforts to sustain volumes.

The effects are already prompting smartphone makers to restructure their product portfolios. According to the report, manufacturers are introducing more 4G and lower-specification models and reducing specifications in certain price segments to manage rising costs while attempting to maintain established price points.

The market is likely to remain under pressure in 2027 as higher device prices extend replacement cycles and limit a recovery in shipment volumes. Growth opportunities are expected to shift increasingly towards premium and upper-mid-range smartphones, while the mass market continues to face affordability constraints and tighter manufacturer margins.

The report also highlighted the growing importance of financing and promotional offers in sustaining consumer purchases. With upfront device prices rising, no-cost equated monthly instalments (EMIs), exchange offers and retailer-led promotions are expected to play a greater role in encouraging upgrades.

The findings point to mounting challenges for smartphone manufacturers in India, where rising component costs and cautious consumer spending are putting pressure on shipment volumes, particularly in price-sensitive segments.