Southeast Asia’s Smartphone Market Hits a 12-Year Low as Prices Surge

Southeast Asia’s smartphone market suffered a severe affordability shock in the second quarter of 2026. Shipments fell 23% year over year to 19.3 million units—the region’s lowest quarterly total since 2014—yet market value remained comparatively resilient at $6.6 billion because average selling prices climbed 31% to $342. 18

The result was not a straightforward upgrade cycle. Some buyers moved into more expensive phones, but the higher price bands did not replace all the volume lost below $100. Omdia’s reading is that many price-sensitive consumers delayed replacement or left the market rather than accept higher prices. 12

The market traded volume for price

The quarter exposed a widening gap between unit demand and market value. Vendors raised prices and reduced discounting as handset costs increased, particularly in the lower end of the market. That protected average selling prices, but it also made smartphones less affordable for consumers who had previously relied on deeply discounted entry-level models. 2720

The shift was visible across price bands:

• The sub-$100 segment contracted sharply as devices were repriced, withdrawn or no longer discounted as aggressively. 220
• The $100–199 segment expanded from 32% to 39% of total shipments, partly because models that once sold below $100 moved into the higher band. 220
• The $200–299 segment became more important for Samsung, whose share of that band rose from 18% in 2Q25 to 32% in 2Q26. 2

This pattern shows why the market’s $6.6 billion value should not be mistaken for healthy unit demand. A smaller number of more expensive devices generated relatively strong value, while the broadest consumer base faced the greatest pressure.

How the major vendors responded

Samsung moved customers upward

Samsung raised prices on the Galaxy A07 and A17 after launch, reversing the more typical pattern of prices gradually falling as a device ages. Its share of the $200–299 price band increased from 18% to 32% year over year. 2

That gave Samsung a way to defend value and strengthen its position in a market where competitors were reducing their focus on phones priced below $300. The strategy was effective in share terms, but it did not eliminate the underlying affordability problem.

Xiaomi reduced its exposure to the mass market

Xiaomi was also part of the broader move away from the lowest price points. Reporting on the quarter indicates that its average selling price rose sharply while sub-$100 shipments fell substantially, consistent with a portfolio shift toward higher-priced devices. 20

The trade-off is clear: a higher average price can support revenue per handset, but it cannot fully offset the loss of buyers who are unable or unwilling to move up.

TRANSSION remained exposed to entry-level demand

TRANSSION’s Infinix and Tecno brands have traditionally had significant exposure to the affordable end of Southeast Asia’s market. In 2Q26, the company’s sub-$100 shipments fell 47%, while shipments in the $100–199 band grew 12%. New Infinix Hot 70 and Tecno Spark 50 4G models also launched at higher prices than the products they replaced. 12

That suggests TRANSSION was able to move some demand upward, but its position remained vulnerable because the region’s biggest disruption occurred precisely where its customer base is most concentrated.

OPPO lost volume at the bottom end

OPPO almost completely withdrew from the sub-$100 segment: shipments in that band fell 96%. Its $100–199 shipments also declined 25%, meaning the next price band did not make up for the lost entry-level volume. Omdia consequently described OPPO as having the largest overall shipment decline among the top five vendors. 2

OPPO’s results illustrate the risk of moving upmarket during a demand shock. Raising prices may improve product economics, but if customers do not follow, the company loses both low-end volume and the opportunity to replace it in the next band.

vivo pushed entry models above $100

vivo moved its entry-level models above $100 in most Southeast Asian markets. Its sub-$100 shipments fell 88% and represented only 5% of its total volume in 2Q26, compared with 32% a year earlier. 28

Like other vendors, vivo improved price realization by leaving more of the lowest band behind. The available reporting does not provide a complete price-band breakdown for vivo, so its broader volume and mix impact cannot be stated precisely.

Why higher price bands did not absorb the lost demand

Some former sub-$100 demand clearly moved into the $100–199 segment. But shipments across the market above $100 also declined, according to Omdia’s interpretation. That means consumers did not simply trade up in sufficient numbers to preserve total unit sales. 12

The remaining explanation is a combination of deferred replacement and market exit: some buyers kept their existing phones longer, while others did not purchase a replacement at all. Higher prices therefore changed the market’s composition while simultaneously shrinking its total reach.

This is the central lesson from 2Q26. The industry’s pricing strategy protected value per device, but it also removed many of the products and discounts that had supported mass-market volume. The region is becoming more valuable per shipment, yet less accessible to the most price-sensitive consumers.

The data comes with a measurement caveat

Omdia reported a 23% year-over-year shipment decline for 2Q26, while Counterpoint reported a smaller 15% decline for the same regional quarter. The difference reflects variations in shipment estimates and market definitions. 15

The precise size of the contraction is therefore disputed, but the direction is consistent across the available research: Southeast Asia’s smartphone market weakened sharply, component and handset costs pushed prices higher, and entry-level demand was hit hardest. 578

For vendors, the immediate priority was profitability and price realization. For consumers, the consequence was fewer genuinely low-cost choices—and a higher likelihood that an overdue replacement would be postponed.