Despite a 10% overall decline in India’s smartphone shipments in Q2 2026, premium device sales surged, driven by innovative financing options and shifting consumer preferences, signalling a growing gap between high-end and budget segments.
India’s smartphone market slipped 10% year on year in the second quarter of 2026 as households held back on upgrades and sellers pared back stock, according to CyberMedia Research. The research firm said the slowdown reflected weak discretionary spending, higher component and handset costs, longer replacement cycles and a push by retailers to optimise inventories across channels.
The weakness was broad-based in the lower-price bands. CyberMedia Research said the affordable category fell 88% and the value-for-money segment dropped 30% year on year, showing how sharply price-sensitive buyers have pulled back. Earlier in the year, the same research house reported a 2% decline in the first quarter, signalling that the market was already under strain before the second-quarter slump deepened.
By contrast, the premium end continued to outperform. Devices priced above Rs 25,000 grew 54% year on year, while the super-premium band of Rs 50,000 to Rs 1 lakh jumped 72%. Menka Kumari, senior analyst at CyberMedia Research, said financing tools such as zero-cost EMI plans, trade-in offers and consumer credit were now playing a bigger role in premium upgrades than features alone. That mirrors broader industry reporting that showed higher-end buyers were less deterred by price rises.
The feature phone market also remains split. CyberMedia Research said 2G feature phones rose 5% year on year, but 4G feature phones fell 43%, underscoring the continuing shift away from entry-level mobile devices. Counterpoint Research separately put India’s smartphone shipment decline at 10% in the June quarter and said rising memory and component costs had pushed up prices across nearly all segments. It also noted that brands were using promotions and financing to support demand, even as the market headed towards what CyberMedia Research expects will be a 10% to 12% full-year decline in 2026.
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