If your phone is three years old and you have been “waiting for the right deal” to replace it, you are not alone. Millions of Indians did exactly the same thing this summer, and the numbers now show just how many of us held on to our old handsets.
India’s smartphone shipments fell 20% year-on-year in the July to September 2026 quarter, according to a new report from market tracker Counterpoint Research released on October 23. That is the weakest third quarter in a decade. The biggest blow landed on budget phones under ₹20,000, where shipments nearly halved. The main reason: record-high memory chip prices that have pushed up the cost of making a phone.
Quick Facts
- Who: Counterpoint Research, via its Monthly India Smartphone Tracker
- What: India smartphone shipments dropped 20% year-on-year, a 10-year low for the quarter
- When: Q3 2026 (July to September); report published October 23, 2026
- Where: India, the world’s second-largest smartphone market
- Key number: Phones under ₹20,000 fell 47%; Samsung is back at No. 1 with a 17% share
Why India’s Smartphone Market Fell 20%
The short answer is memory. The chips that store your photos and run your apps are at record-high prices, Counterpoint says. When the cost of RAM and storage jumps, phone makers either raise prices or cut specs. This year, many did both.
That squeeze changed how people shopped. Counterpoint analyst Shubham Singh said buyers “became more selective, extended their replacement cycles and deferred upgrades.” In plain terms: if your current phone still makes calls, runs WhatsApp and pays through UPI, you probably decided it could last one more year.
Brands also played it safe. Instead of stuffing stores with stock before Diwali, they kept inventory lean and focused on protecting margins. Fewer phones shipped to shops means a lower shipment number, even before a single customer walks in.
Budget Phones Under ₹20,000 Took the Biggest Hit
The 47% fall in the sub-₹20,000 segment is the headline that should worry the industry most. This is the price band where first-time buyers, students and most families shop. Counterpoint says rising prices pushed many models into higher price bands. Think of a phone that used to cost ₹17,999 and now sits just above ₹20,000. That shift partly explains why the segment shrank so sharply.
Rising component costs hurt affordability most in the mass market, especially below ₹15,000. Brands are responding with more 4G models and lower-spec phones to hold prices down. So if you are shopping in that range, do not be surprised if a “new” phone has less RAM than last year’s version.
Samsung Is Back on Top: Brand Rankings for Q3 2026
In a shrinking market, Samsung was the only top-five brand to actually grow. It reclaimed the No. 1 spot after nine quarters, with a 17% share, helped by its Galaxy A series and its foldables. Here is how the top of the table looks:
- Samsung – 17%
- vivo (excluding iQOO) – 16%
- OPPO – 12%, with triple-digit growth above ₹20,000
- Xiaomi (including POCO) – 12%, still the top brand in the ₹10,001 to ₹20,000 band
There were a few bright spots further down. Ai+ was the fastest-growing brand, with shipments up 306%. Indian brands together grew their share from 2% to 7%, mostly by selling cheaper phones. Transsion’s itel grew 88% on the back of 4G phones under ₹15,000, and Google’s Pixel shipments rose more than 50%.
Premium Phones Are Still Selling
Here is the strange split in India right now. While budget buyers wait, the top end keeps moving. Counterpoint says initial iPhone 18 Pro sales in India were nearly 20% higher than the iPhone 17 Pro’s launch last year. And as we reported this week, Apple’s first-week stock of the iPhone Duo foldable was fully pre-booked in India despite its sky-high price.
Research director Tarun Pathak expects growth to keep shifting toward premium and upper-mid phones. Easy finance is a big part of that story. He says no-cost EMIs, exchange offers and retailer promotions will become even more important to close a sale.
What We Don’t Know Yet
Counterpoint’s public note does not give the total number of phones shipped in the quarter, only the percentage drop. It is also too early to say how the Diwali sales period will finish, or how quickly memory prices might cool. Other trackers such as IDC and Canalys publish their own estimates, and their numbers can differ.
What This Means for You
Counterpoint expects phone makers to raise prices again after the festive sale, and it sees the Indian market shrinking about 13% across 2026, with 2027 also looking tough. If you are planning to buy, a few practical tips:
- Buy sooner if you need a phone now. Prices are more likely to go up than down after the festive season.
- Check the specs, not just the name. A new model may quietly ship with less RAM or storage, or with 4G instead of 5G.
- Use exchange offers. Your old phone can knock a real chunk off the price.
- Read the EMI fine print. “No-cost” EMI can still carry processing fees, and missed payments hurt your credit score.
- Keep your current phone going. A new battery and a software update can buy you another year for far less money.
Our Take
A chip shortage sounds like a distant boardroom problem. This report shows it reaching straight into the pockets of ordinary Indian buyers. When a ₹15,000 phone becomes a ₹19,000 phone with fewer features, the first-time smartphone user is the one who loses out. Brands chasing premium buyers with EMIs is smart business, but India’s digital growth still depends on good, cheap phones. Someone needs to keep making them.
FAQs
Why did smartphone sales fall in India in 2026?
Record-high memory chip prices raised phone costs, so buyers delayed upgrades and kept old phones longer. Brands also shipped less stock to protect their margins.
Which is the No. 1 smartphone brand in India right now?
Samsung, with a 17% share in Q3 2026, according to Counterpoint. vivo is a close second at 16%.
Will smartphone prices go up in India after Diwali?
Counterpoint expects phone makers to raise prices again after the festive sale, as memory costs stay high.
How much did budget phone sales drop?
Shipments of phones under ₹20,000 fell 47% year-on-year in July to September 2026, the steepest drop of any price band.
Is it a good time to buy a new phone?
If you need one, festive offers and exchange deals may be better now than after the season, when prices are expected to rise. If your phone works fine, waiting is also reasonable.
You can read Counterpoint’s full note on its website.
Based on reporting by Counterpoint Research, ETV Bharat and TelecomTalk.
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