Memory chip surge lifts India smartphone prices 40%, aiding Apple, Samsung

Memory chip prices that have quadrupled since September 2025 are ending the era of sub-$150 smartphones in India, eroding the low-price edge of Chinese brands and shifting share to Apple and Samsung.

"It is the end of the sub-$150 smartphones," Neil Shah, co-founder at Counterpoint Research, said. New Chinese models in India could cost $200 to $250, up from under $150, while prices in the sub-$150 category have already risen as much as 40 percent.

IDC reported last week that India smartphone shipments fell to 64.2 million units in the first half of 2026, with volume down 7.9 percent year over year but value up 3.6 percent as the average selling price hit a record $315, up 14.4 percent.

The shift is reshaping the world's second-largest phone market. Chinese brands that dominate the budget segment posted double-digit shipment declines in the June quarter, while Samsung and Apple were the only major names to hold steady and gain share, according to IDC.

Chinese Brands Lose the Price Battle

Chinese smartphone makers, which hold four of the top five spots in India, are struggling to convince price-sensitive buyers to accept higher tags. In the June quarter, Vivo shipments fell 13.9 percent year over year, Oppo dropped 8.5 percent, Xiaomi declined 10 percent and Realme plunged 14.2 percent, IDC data shows. OnePlus, which serves the premium segment, posted the smallest decline at 2.5 percent.

The gap between market leader Vivo and second-place Samsung narrowed sharply. Samsung's market share rose nearly 200 basis points and Apple's gained 100 basis points in the June quarter, while Vivo's fell 60 basis points, according to IDC. Counterpoint Research estimates an even steeper 140-basis-point decline for Vivo. The iPhone 17 remained the top-shipping model in India for two consecutive quarters.

Samsung, whose India portfolio spans $200 to more than $800, has gone head-to-head with Vivo in the $200-$300 segment. The South Korean company holds a structural cost advantage: it sources memory chips in-house, while Vivo and other Chinese firms depend on MediaTek, SK Hynix and Samsung for supply, Shah said.

Chip Supply Pivots to AI

When memory prices began climbing last year, many Chinese brands shifted to chips from UNISOC and CXMT to protect market share, Shah said, but the arrangement is hard to sustain. CXMT recently raised funds to expand capacity to serve China's AI and data center markets, diverting resources toward high-end products and potentially tightening mobile memory supply.

The cost shock has spilled into tablets. Global tablet shipments fell to 33.61 million units in the second quarter, down 12.3 percent year over year, IDC's Worldwide Quarterly Personal Computing Device Tracker shows. Samsung raised Galaxy Tab prices by $40 to $280 in April, Lenovo lifted prices $30 to $70, and Apple raised tablet prices globally in June, with several models up 20 percent or more.

Large vendors have shown stronger procurement power, with the top five — Apple, Samsung, Lenovo, Huawei and Xiaomi — accounting for 79.8 percent of the global tablet market, up from 77.9 percent in the first quarter. Lenovo posted the strongest performance among major vendors, with tablet shipments up 26.2 percent year over year.

As budget phones become more expensive and installment financing improves affordability of higher-priced handsets, experts expect India's once price-sensitive market to tilt toward premium products. Apple stands to extend its India growth, while Chinese makers face margin compression and volume declines that could weigh on Xiaomi and other listed names.

This article is for informational purposes only and does not constitute investment advice.