The global smartphone market is projected to face a 12% reduction in shipments by the end of 2026, with manufacturers expected to ship around 1.097 billion devices. Despite this decline in physical volume, Omdia analysts anticipate that the market's monetary value will increase, primarily due to changing consumer preferences for more expensive devices.
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The average price of a smartphone is expected to rise to approximately $594, resulting in a total global market value of $651.6 billion, marking a growth of around 12% year-over-year. This divergence is largely attributed to the shrinking share of budget devices, particularly in the sub-$200 segment, which accounted for 40.6% of shipments in 2025. By 2027, this share is forecasted to decrease to 25.6%.
As budget smartphones lose market share, the segment for devices priced at $800 and above is growing. In 2025, this high-end category comprised 21.1% of global shipments, with Omdia expecting it to rise to 28.4% by 2027. This trend indicates that while consumers may be upgrading less frequently, they are investing in higher-priced models when making purchases.
Rising component prices are also contributing to increased production costs, which manufacturers are beginning to pass on to consumers. Price hikes have affected iPhone models, with similar increases anticipated for Samsung smartphones. Consequently, the market is seeing an increase in average prices driven by the growing share of premium devices and higher manufacturing costs.
Additionally, manufacturers are extending the software support period for smartphones, with some models receiving updates for up to seven years. This longer lifespan reduces the necessity for frequent device replacements for new software.
Overall, the smartphone industry is undergoing a significant transition, with a decrease in shipments accompanied by a rising average device value, reshaping the market dynamics as budget models dwindle and premium options flourish.