The festive season is traditionally one of the biggest shopping periods for smartphones in India. Around Diwali and other major festivals, brands typically attract buyers with price cuts, bank offers, cashback deals and exchange bonuses.

However, this year could be different. Consumers may not see the same level of discounts as in previous years, as rising memory prices and higher component costs are putting pressure on smartphone manufacturers.

According to an ET report, India's smartphone sales are projected to decline by around 10% year-on-year in 2026.

Smartphone market already facing a slowdown

India's smartphone market declined 11% year-on-year in the second quarter of 2026. One of the major concerns for manufacturers is the sharp increase in memory prices, which has made it more expensive to manufacture smartphones.

The slowdown is not limited to India. Globally, smartphone shipments declined 7.4% year-on-year to 276.3 million units in the second quarter of 2026. This marked the second consecutive quarter of year-on-year decline in the global smartphone market.

With demand under pressure and production costs increasing, smartphone companies are now having to balance sales targets with profitability.

Why are memory chip prices increasing?

The growing demand for artificial intelligence is one of the major factors affecting the memory market.

Companies such as SK Hynix, Samsung and Micron are increasingly focusing on specialised memory products required for AI-related applications. As manufacturers allocate more capacity towards these high-demand products, the supply of conventional memory used in smartphones and other consumer electronics has come under pressure.

According to the report, prices of general DRAM memory could rise by around 13% to 18% in the third quarter of 2026.

Higher memory costs ultimately increase the cost of manufacturing smartphones, creating additional pressure on brands.

Smartphone companies have already started increasing prices

The impact of rising component costs is already visible in smartphone pricing.

Brands including Realme, Oppo, Vivo, Samsung and OnePlus have reportedly increased the prices of selected models.

According to reports:

• Realme has increased prices of several smartphones by around ₹1,000 to ₹4,000.

• Oppo has raised prices of select Reno and A-series models by up to ₹5,000.

• Vivo has increased prices by approximately ₹500 to ₹4,000 in some markets.

• OnePlus has raised prices of certain models by around ₹2,000 to ₹4,000.

• Samsung has increased prices for some smartphones in its S, M and F series.

• One variant of the Galaxy S25 reportedly became ₹12,000 more expensive.

Apple has also reportedly increased the prices of certain iPhone models in India. According to the report, the 256GB iPhone 17 is now priced at ₹99,900, compared with ₹82,900 at launch.

Festive offers could look different this year

With manufacturing costs rising, smartphone companies may have less room to offer large upfront discounts during the festive season.

Instead of simply reducing the sticker price, brands could rely more heavily on alternative offers such as:

• No-cost EMI schemes

• Bank cashback offers

• Credit and debit card discounts

• Exchange bonuses

• NBFC financing

• Special upgrade offers

This could allow companies to maintain the effective purchase value for customers without making large direct reductions to the phone's listed price.

EMI and financing could become more important

Financing is already becoming an increasingly important part of smartphone purchases.

According to the report, purchases made through NBFC financing and credit or debit card EMI schemes could account for around 42% of smartphone sales in 2026, compared with approximately 35% in 2025.

This means consumers may increasingly choose to spread the cost of expensive smartphones over several months rather than paying the full amount upfront.

Used smartphones could also benefit

Higher prices for new smartphones could have another effect: increased demand for the second-hand and refurbished smartphone market.

For consumers who find premium smartphones too expensive, used devices can offer access to higher-end specifications at a lower price.

Exchange programmes could become particularly important during the festive season. Customers may be able to reduce the effective cost of a new premium smartphone by trading in their existing device.

What should smartphone buyers expect this festive season?

The festive season is still likely to bring plenty of smartphone deals, but the nature of those offers could change.

Instead of very large direct price cuts, buyers may see more emphasis on cashback, EMI schemes, exchange bonuses and bundled benefits. At the same time, higher component costs could mean that some smartphones remain expensive even during major sales.

For consumers planning to buy a new phone, comparing the final effective price—including bank discounts, exchange value, cashback and EMI benefits—may be more useful than looking only at the advertised discount.