Smartphone prices have risen sharply in 2026. While the Indian smartphone industry recorded almost no net price movement in 2025, the chart has gone up by 7.9 per cent in just five months of this year.
According to a report by market tracker TechArc, the price index increased every month in 2026 through May, rising by about 2.16 per cent each month. Currently, there is no indication that the trend will reverse. Entry-level and base-level smartphones appear to have been hit the hardest.
According to the report, the ratio between price increases and price cuts was 1:1 in 2025. In 2026, that has changed to 4.4:1. In simple terms, smartphone prices remained close to flat last year, but in the first five months of 2026, price increases have far outpaced cuts. One main reason for this surge is the global shortage of memory.
How the trend changed between 2025 and 2026
Prices stayed close to launch prices during the first quarter and gradually declined through the middle of the year as the initial launch premium faded. They reached their lowest point in September, when prices were about 5 per cent below launch levels. However, prices recovered towards the end of the year, with the index returning to 100 per cent by December. Overall, there was almost no change over the full year.
That trend has reversed decisively in 2026.
Price increases have significantly outpaced reductions, with 79 models becoming more expensive compared to only 18 seeing cuts. Overall, smartphone prices rose every month between January and May, resulting in an average increase of 7.9 per cent in just five months.
In contrast, in 2025, 47 smartphone models saw price increases and 44 saw price cuts. Prices of 66 models remained flat in 2025, compared to 60 from January to May 2026.
In simple terms, Indian buyers who earlier benefited from waiting for post-launch discounts are now facing a market where delaying a purchase could mean paying more.
Among segments, entry-level smartphones saw the sharpest rise in both 2025 and 2026. The category, which saw an average price increase of 7 per cent last year, recorded a 17.6 per cent rise in the first five months of 2026. At the top end, the luxury segment saw a small increase in 2025, but prices declined slightly in 2026.
Which segments faced the price increases?
The TechArc study divided the smartphone market into six segments:
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Entry-level: less than Rs 10,000 -
Base-level: Rs 10,000 to Rs 20,000 -
Mid-level: Rs 20,000 to Rs 30,000 -
Premium: Rs 30,000 to Rs 50,000 -
Premium Pro: Rs 50,000 to Rs 100,000 -
Luxe or Luxury: above Rs 100,000
The sharpest change was seen in lower-priced segments.
Entry-level devices priced below Rs 10,000, which had already become 7 per cent more expensive in 2025, saw average prices rise by 17.6 per cent in 2026.
Similarly, the base-level segment moved from a modest 1.2 per cent increase in 2025 to a much steeper 13.9 per cent rise this year.
The mid-level segment saw a 1.6 per cent price decline last year, but in 2026, prices increased by 5.6 per cent.
In contrast, the pace of price growth moderated as devices became more expensive.
Smartphones in the premium bracket rose 2.8 per cent in 2026 after declining 5.7 per cent in 2025.
Premium Pro models remained cheaper. In 2025, their prices fell 3.1 per cent, and in 2026, they declined 2 per cent.
In the luxury segment, prices rose 0.4 per cent in 2025, but fell 2.6 per cent in 2026.
Why are smartphone prices rising?
A major factor behind the current wave of smartphone price increases is a prolonged global shortage of memory chips, including DRAM and NAND, which are essential components in modern smartphones.
According to a Nikkei Asia report, supply constraints are expected to persist as major memory manufacturers such as Samsung Electronics, SK Hynix and Micron struggle to expand production quickly enough. Together, these companies control around 90 per cent of the global DRAM market.
The report noted that memory shortages could continue until around 2027, with planned production increases expected to meet only about 60 per cent of demand.
The main driver of the shortage is the rapid growth of AI infrastructure.
Memory manufacturers are increasingly prioritising high-bandwidth memory (HBM), a higher-margin product used in AI servers and data centres. This has reduced the supply of general-purpose memory used in smartphones and PCs.
Analysts expect the pressure to continue.
Upasana Joshi, senior research manager, Devices Research Asia/Pacific, IDC, noted in one of its reports that the global memory shortage is likely to extend into 2027, with rupee depreciation adding further cost pressure.
The impact is also visible in shipments.
Counterpoint Research reported a 3 per cent year-on-year decline in overall smartphone shipments during the Q1, CY2026, describing it as the weakest first quarter for the industry in six years. It further projected a full-year decline of around 10 per cent in smartphone shipments for 2026.
Why entry-level smartphones are suffering the most
While rising memory costs are affecting the entire smartphone market, the impact is being felt most sharply at the lower end of the price spectrum.
In an earlier interview with Business Standard, Sumit Singh, SVP and product head at Lava International, said memory had emerged as the single biggest cost pressure for smartphone makers.
He explained that memory, which previously accounted for around 15-20 per cent of a smartphone’s total cost, now contributes nearly half of the bill of materials, fundamentally changing the economics of smartphone manufacturing.
That shift is making ultra-affordable smartphones increasingly difficult to sustain.
Singh said devices that were once commonly available in the Rs 6,000-Rs 7,000 range are gradually disappearing, with the practical entry point for new smartphones moving closer to Rs 8,000-Rs 10,000.
Rather than a temporary pricing cycle, he described it as a structural change that is making it harder for brands to offer low-cost smartphones without sacrificing margins.
Counterpoint Research senior analyst Prachir Singh made a similar point earlier.
In April, Singh said: “The market is facing a clear affordability squeeze, driven by sharp memory-led cost inflation and currency pressures that have forced OEMs to raise prices across key models. With average hikes exceeding Rs 1,500, the sub-Rs 15,000 segment has been hit the hardest, given its high price sensitivity.”
Industry data suggests that this transition is already underway.
According to IDC, shipments in the entry-level smartphone segment, or sub-$100 category, declined 59 per cent year-on-year in the first quarter of CY2026, while the segment’s share of the market fell from 18 per cent to just 8 per cent.
Together, these figures suggest that rising component costs are disproportionately affecting the most price-sensitive segment of the market.
Which brands were affected the most?
At the brand level, 2026 saw a much sharper divergence in pricing strategies than 2025.
While most brands remained relatively stable last year, the biggest increases in 2026 came from value-focused players.
Acer recorded the largest average increase, with prices rising 63.7 per cent, followed by Ai+ at 31.6 per cent, Redmi at 26.5 per cent, CMF at 24.3 per cent, Infinix at 19.9 per cent and Poco at 16.4 per cent.
On the other side, Xiaomi reduced prices by 13 per cent, while Itel and Alcatel lowered prices by 6.8 per cent and 6.6 per cent, respectively. Apple and Honor remained broadly unchanged.
Based on smartphones launched between 2025 and May 2026, Google smartphones saw a price rise of 4.6 per cent, while Samsung recorded a price rise of 6.1 per cent.
iPhones stayed unchanged, with no price increase.
Google and Apple smartphones are priced in the Premium Pro to Luxury segment, while Samsung’s portfolio is spread across segments, from affordable models to flagships.
The pattern closely mirrors the broader market trend, with budget-focused brands pushing through the largest increases while premium players have largely held prices steady or offered selective cuts.
What’s the outlook for India’s smartphone industry?
The forces driving smartphone prices higher are unlikely to disappear soon.
The global memory shortage is expected to continue until at least 2027 as demand from AI infrastructure continues to absorb a growing share of supply. As a result, the cost pressures currently affecting smartphone makers are expected to remain in place over the coming quarters.
That outlook is echoed in TechArc’s assessment of the Indian market.
The research firm believes the price increases seen across smartphone categories in the first half of 2026 are unlikely to be reversed, even if component costs eventually begin to stabilise.
Once consumers accept a higher price band, brands typically have little incentive to roll prices back.
In practical terms, this means the new pricing levels emerging in the Rs 8,000-Rs 18,000 segment could become the industry’s new normal rather than a temporary adjustment.
According to TechArc, the next battleground will be the mid-range segment. The firm identified the Rs 20,000-Rs 30,000 category as a key indicator to watch in the second half of 2026.
If prices continue to firm up in this bracket, it would suggest that inflationary pressures that first hit budget smartphones are moving further up the market.
At the same time, premium smartphones may continue to see steep discounts and promotional offers as brands compete for flagship sales, creating a different pricing dynamic at the top end.
