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According to a new report by Omdia analysts, in Q2 2026, the global smartphone market contracted by 6% year-over-year, with shipments falling to 272.0 million units. This was a result of strong demand in the previous quarter, after which the market entered a correction phase linked to the memory price cycle. Rising memory prices disrupted supply chains and drove up component costs, forcing manufacturers to revise their pricing policies, product portfolios, and channel strategies.
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As a result, the market has become even more polarized, as manufacturers’ success is increasingly influenced by scale, supply chain resilience, pricing power, and dependence on the budget smartphone segment.
Samsung retained the top spot – the company shipped 60.5 million devices, a 5% increase compared to the same period last year. Its market share stands at 22%. Samsung’s memory business helped the company cope more effectively with component shortages, and the delayed launch of the Galaxy S26 series shifted demand for premium models to the second quarter. In addition, Samsung strengthened its position in the budget segment thanks to a reduction in its product lines and price increases by Chinese competitors.
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Meanwhile, for Apple, this was the most successful second quarter in its history. The company shipped 55.1 million smartphones, a 23% increase year-over-year, and achieved a record market share of 20%. Interestingly, this quarter is usually the weakest for the tech giant. The company’s partners have increased their inventory of the base model iPhone 17 ahead of an expected price hike. Although Apple has generally kept iPhone prices stable, recent price increases in other product categories raise the likelihood that the iPhone will become more expensive by the end of the year.
Xiaomi remained in third place with 31.2 million smartphones, down 26% from a year earlier. This marks the second consecutive quarter in which the company has posted a decline. Since more than half of its shipments consist of devices priced at $200 or less, Xiaomi has been hit hardest among the top five manufacturers by rising memory prices, particularly in the Asia-Pacific and Latin American markets.
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OPPO, including realme and OnePlus, ranked fourth with 28.4 million smartphones shipped, down 17% year-over-year. The company optimized its portfolio of three brands and reduced the number of budget models. Rounding out the top five was vivo, which shipped 21.5 million smartphones, down 18% compared to the same period last year.
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The first half of 2026 marked the beginning of a reset for the smartphone industry. Rising costs of memory, storage, and processors shifted manufacturers’ priorities, moving the focus from maximizing shipment volumes to protecting profitability and average selling prices. Manufacturers partially passed on the rising costs of components to consumers by adopting a stricter approach to budget model lines and accelerating the shift toward mid-range and premium smartphones.
Regional factors contributed to the market’s weaker performance. In the Middle East, smartphone shipments fell by 18% year-over-year due to an escalation of the geopolitical situation, which disrupted supply chains and retail operations. However, this is likely to be temporary. At the same time, rising prices have shifted consumer expectations regarding smartphone costs. Buyers are becoming accustomed to more expensive devices, while manufacturers are gaining greater opportunities to establish a structurally higher price level.
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“Price is once again becoming one of the key factors in competition,” says Omdia research manager Le Xuan Chiev. “The current cycle of rising memory costs is leading to a structural reassessment of the industry and driving long-term changes in how manufacturers compete through pricing, profitability, and product positioning.”
Although inventory levels in distribution channels have largely returned to normal, high component costs are expected to continue putting pressure on the smartphone market through the end of 2026. Manufacturers are expected to continue pursuing a conservative supply policy, optimize their product portfolios, and prioritize profitability over market share.
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