Global smartphone shipments reached 298.5 million units in the first quarter of 2026, recording a modest increase of 1 per cent compared with the same period last year, according to new figures from Omdia.

The result reflects a mix of contrasting forces. Manufacturers such as Samsung and Apple pushed large volumes into distribution channels early, anticipating rising costs for memory and other components. This strategy helped lift shipment numbers beyond initial forecasts, but underlying consumer demand remained weaker due to ongoing economic pressure.

Rising living costs have reduced household spending power, particularly for non-essential purchases like smartphones. As a result, a gap has emerged between the number of devices shipped into retail channels and the number actually purchased by consumers, a trend that analysts expect will lead to a slowdown in the months ahead.

Samsung maintained its position as the leading global supplier, shipping 65.4 million devices, up 8 per cent year-on-year. The company saw steady demand across its range, with entry-level models performing well in developing markets while its premium Galaxy S26 series supported higher-end sales.

Apple followed closely with 60.4 million units shipped, marking a 10 per cent increase. Growth was largely driven by the iPhone 17 lineup, with the more affordable iPhone 17e gaining traction in markets such as Europe and Japan. Higher-end models also performed strongly, particularly in mainland China, where shipments rose 42 per cent.

Xiaomi experienced the sharpest decline among the top five manufacturers, with shipments falling 19 per cent to 33.8 million units. The company’s heavy reliance on lower-priced devices left it more exposed to rising component costs, which have squeezed margins and reduced volumes in its core segment.

OPPO, including its Realme and OnePlus brands, shipped 30.7 million units, down 6 per cent, while vivo recorded 21.3 million units, a decline of 7 per cent. Both companies saw softer demand after pushing significant volumes into entry-level channels late last year.

Outside the leading group, HONOR stood out as the fastest-growing brand among the top ten, with shipments rising 19 per cent to 19.2 million units. Growth was fueled by strong expansion in international markets, particularly in the Middle East and Africa, although performance in mainland China weakened due to intense competition.

The broader market is being shaped by rising costs for components such as memory and storage, which have been increasing steadily. This has encouraged manufacturers and distributors to bring forward orders to avoid higher prices later, resulting in excess inventory across the supply chain.

While shipments have been supported in the short term, actual consumer demand has not kept pace. Higher prices for everyday goods have led many buyers to delay upgrades, extending the lifespan of their devices and becoming more selective, especially when considering mid-range and premium models.

Manufacturers have begun passing on some of these cost increases, particularly in lower-priced devices where profit margins are thinner. This has had a greater impact in price-sensitive regions, further limiting demand.

Analysts expect the market to shift in the coming quarters as excess stock is gradually cleared. Shipment volumes are likely to slow as companies adjust to more cautious demand conditions and focus on managing inventory levels.

The second half of 2026 is expected to remain challenging, with inflation continuing to weigh on consumer spending. Replacement cycles are likely to lengthen further, and overall growth may remain subdued as the industry adapts to a more uncertain environment.

Longer term, supply-side pressures, particularly around memory and storage components, are expected to continue influencing the market for at least the next two years, shaping both pricing and production strategies across the sector.