Apple, Samsung Set to Gain as Ultra-Cheap Smartphone Era Comes to an End

The global smartphone market is undergoing a major structural shift as rising component costs and supply constraints push budget devices out of the market, potentially strengthening premium brands like Apple and Samsung.

May 27, 2026 | New Delhi

The global smartphone industry is witnessing a significant transformation as the era of ultra-cheap smartphones appears to be fading, according to industry reports. Increasing production costs driven by memory chip shortages, higher logistics expenses, and geopolitical tensions are forcing manufacturers to scale back low-end devices, reshaping the competitive landscape.

A recent market analysis suggests that shrinking profit margins in the entry-level segment are making it increasingly difficult for brands to sustain ultra-budget smartphones. As a result, companies are shifting focus toward mid-range and premium devices, where profitability remains stronger. This transition is expected to benefit major players such as Apple and Samsung, which already dominate the high-value smartphone segment.

Industry forecasts indicate that global smartphone shipments may decline sharply in 2026, with analysts attributing the slowdown to a combination of rising input costs and weaker demand in price-sensitive markets. The disappearance of sub-$200 smartphones is particularly impacting emerging economies, where affordability has traditionally driven mass adoption.

Experts also highlight that the ongoing expansion of artificial intelligence infrastructure is absorbing a significant share of global memory chip production, further tightening supply for consumer electronics. This imbalance has led to higher manufacturing costs, which are being passed on to consumers through elevated device prices.

As a result, the average selling price of smartphones is expected to reach record levels, accelerating a long-term shift toward premiumisation. Apple is projected to benefit from strong demand for its ecosystem-driven products, while Samsung’s diversified portfolio across flagship and mid-range devices positions it well to capture shifting consumer preferences.

Analysts believe this structural reset could permanently redefine the smartphone market, reducing the dominance of ultra-low-cost devices and strengthening brands with strong ecosystems, software support, and global supply chain resilience.

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