Memory price surge squeezes sub-₹10,000 smartphone segment in India

Rising memory prices have crushed India's sub-Rs 10,000 smartphone segment, forcing brands to raise prices and shift entry-level models into higher price bands

India’s once-popular sub-₹10,000 mass-market smartphone segment has collapsed. The culprit is a massive nine-fold surge in memory prices over the last nine months, which has made it financially unviable for manufacturers to sell devices in this price band.

 

From a reasonable 18 per cent volume share of the total smartphone market in the third quarter of calendar year 2025 (Q3CY25), the entry-level segment was squeezed to just 4 per cent by Q2CY26 — all within 12 months.

 

“Memory price inflation is effectively redrawing the entry-level smartphone market in India. As memory and other component prices rise, original equipment manufacturers (OEMs) are increasingly moving entry-level models to higher price bands rather than fully absorbing the cost increases. As a result, the sub-₹10,000 phone bracket has seen a dramatic erosion in its share,” said Counterpoint Research Analyst Shubham Singh, explaining the dramatic change.

   

High memory costs have driven average mobile phone prices up by 15 per cent. They are predicted to rise another 5-7 per cent next quarter, placing further upward pressure on retail prices. 

 

Memory prices in entry-level phones have more than doubled, soaring from 15-20 per cent of the bill of materials to over 45 per cent as of June 2026. This surge severely compresses margins, leaving no room to cut costs by downgrading specifications.

 

Pressure is also affecting the ₹10,000-20,000 smartphone segment. However, this category remains relatively resilient as entry-level models migrate upward, causing its market share to decline only marginally from 47 per cent in Q4CY25 to 46 per cent in Q2CY26.

 

The chief beneficiaries of the price increase are two segments: smartphones priced between ₹20,000 and ₹30,000, and premium models in the ₹30,000-45,000 band. While the former saw its volume share rise to 25 per cent in Q2CY26, the latter's share grew from 6 per cent in Q4CY25 to 10 per cent in Q2CY26.

 

Despite the widespread buzz surrounding smartphone premiumisation, the super-premium segment — valued at over ₹45,000 — reveals a very different trend.

 

However, it is not all over for the entry-level smartphone segment. Just a few years ago, chipmakers like Qualcomm and MediaTek were in overdrive to design chipsets that would make 5G smartphones viable under the ₹10,000 price point, aiming to expand the reach of the latest telecom services. They successfully collaborated with OEMs to turn this vision into reality.