India Smartphone Shipments Drop 10% in Q2 as AI Memory Crunch Lifts Handset Prices
Updated
Updated · TechCrunch · Jul 17
India Smartphone Shipments Drop 10% in Q2 as AI Memory Crunch Lifts Handset Prices
3 articles · Updated · TechCrunch · Jul 17
Summary
Counterpoint said India’s smartphone shipments fell 10% year over year in the April-June quarter, the steepest June-quarter decline in six years and a sharper drop than China’s 2% slide.
AI-driven demand for high-bandwidth memory has pulled Samsung, SK Hynix and Micron capacity away from standard phone RAM and storage, raising handset costs in a market where about 60% of sales are below ₹20,000.
The squeeze hit the low end hardest: sub-₹15,000 smartphone shipments plunged 45%, while prices rose 4% to 68% depending on model and replacement cycles stretched to about four years from 3.5.
Samsung was the only major brand to grow in India in Q2, up 2%, while Apple shipments fell 3% mainly on supply constraints; Chinese brands lost share as thinner margins undermined entry-level models.
IDC expects another double-digit Q2 decline and says memory shortages and elevated prices could last until at least end-2027, reinforcing India’s shift from volume growth toward value growth.
Are tech giants using the AI chip shortage as a crisis to end the era of affordable smartphones?
Is the AI boom creating a new digital divide by pricing millions out of the smartphone market?
As AI reshapes our economy, can alternative technologies prevent a permanent shortage of essential electronics?
India’s Smartphone Market Suffers Steepest Drop Since 2020: AI Memory Boom Triggers Price Hikes and Threatens Digital Inclusion
Overview
India's smartphone market saw its sharpest decline in six years during Q2 2026, with shipments dropping 10% year-over-year as multiple rounds of price hikes and rising memory and component costs pushed device prices higher. These increases, driven by a global memory chip shortage caused by surging AI data center demand, forced consumers to delay upgrading their phones and squeezed affordability, especially in the mass-market segment. While ultra-premium smartphones remained resilient thanks to financing options, most affordable models faced significant pressure. With memory prices unlikely to normalize soon, manufacturers are focusing on premium offerings and strategic product adjustments to navigate ongoing challenges.