The Indian smartphone market is forecast to enter an era in which prices will be “sticky” or refuse to budge, and the concept of value for money will become challenging, primarily due to the increasing price of memory. When folks refer to “Increasing Memory Prices,” it primarily refers to DRAM or RAM and NAND Flash storage, which play a crucial role in distinguishing 6GB or 8GB of RAM and 128GB or 256GB internal storage in smartphones. The above two account for a substantial quantity of a smartphone’s bill of materials, and therefore, an increase in memory prices will only result in limited absorption of this increase through subsequent price cuts by smartphones manufacturers.

According to recent supply chain and market alerts, the cost concern is expected to persist through 2026, with a few forecasts identifying the continued stress until about Q3 2026 (July, August, and September 2026).

This is a more detailed analysis of why the prices of memory are increasing, the implications of this on the Indian smartphone market, how the manufacturers will deal with the situation, and what the users can expect in the period until the end of September 2026.

1) What “memory chip prices” refers to in a smartphone

A smartphone usually uses two types of memory:

Simply put, DRAM or

This is the short-term memory, which is employed in multitasking, application switching, image processing, gaming, and now a whole host of AI applications on mobile devices.

In phones, it might be LPDDR (low-power DRAM), such as LPDDR4X or maybe

C) Microprocessors and microcontrollers-package

This refers to long-term storage of OS, applications, photos, as well as videos.

In phones, it’s commonly UFS (with NAND flash) such as UFS 2.2, UFS 3.1, and UFS

When the contract prices for DRAM/NAND go up, the phone manufacturer has the following options:

Raise the phone price, or

Lower specs (for instance, same price but from 8GB to 6GB or from 256GB to 128GB), or

Reduce costs elsewhere (lower quality camera sensor, lower charging speed, older display panel, lower materials costs), or

Accept lower profit (hard to sustain over the long term, especially in the budget segment).
Trendforce has pointed out that as the “pressure on memory cost reaches a critical point, brands may need to stop cutting prices and lower specs.”

2) Why memory prices are going up now (and why it’s not “just temporary”)

While memory pricing follows a cycle, there’s something different this time, and that’s the structural component of AI-infrastructure demand driving capacity away from consumer.
A) AI data centers are absorbing memory supply
The demand for AI servers worldwide drives an enormous requirement for memory, in particular, for High Bandwidth Memory intended for AI accelerators, as well as for traditional DRAM as well as NAND in the server market. There have been several reports pointing out that demand from AI is one of the reasons why the memory market faces a shortage of memory and why memory prices are up.

B) Memory manufacturers focus more on the more profitable AI products
The financial motivations for companies like Micron, Samsung, and SK hynix are substantial enough for them to consider their primary customers as those from the data centers or the AI segment. The reporting on Micron’s forecast and earnings has indicated that the shortage is likely to continue beyond the year 2026, and as such, there won’t be any ‘snap back’ into cheap consumer memory anytime soon.

The Verge

C) The production of HBM “consumes” capacity that could have yielded phone memory.
One important aspect: making something as advanced as memory (e.g., HBM) may necessitate more complicated packaging and may also be a resource-intensive process. What has been noticed in trends as reported is that focusing on AI memory may result in squeezed availability for “mainstream” memory used in smartphones and PCs.

D) Suppliers are cautious about expanding capacity too fast

“Memory makers have been burned before by overbuilding and then facing the consequences of price collapses. Even if the demand is strong, they may expand with caution in order to safeguard their profitability. That’s called supply discipline, and that keeps the prices sustained for a longer period than consumers expect.”

E) There are predictions of further growth through the first two months of 2026

Trend Force has indicated that memory prices are forecasted to jump again in the 1Q of 2026, which will lead device manufacturers to opt for higher prices or reduced specs.

Counterpoint had also reduced its estimate for 2026 smartphone shipments because memory cost inflation contributes to increasing BoM.

counterpoint

To sum up: even if demands are not explosive for phones, the ‘center of gravity of the memory industry has shifted to AI, and that continues to push consumer electronics.’

3) Reasons for which the pain is felt more in India than other markets

One of the largest and price-sensitive smartphone markets in the world, the Indian market is extremely sensitive to price shocks in a unique way.

A) The market is very competitive, with a penchant for discounted prices

In the Indian bottles and packaging industry, a huge chunk of the business volume is in the value segments where the following are competing with various international

aggressive pricing,

Bank offers/EM

exchange bonuses,

festive sales discounts.

If memory costs go up, brands won’t be able to churn out discounts so easily, as this will start affecting their margins. This makes news like “Under Stress” relevant, as brands will not be able to resort to the old trick of dropping prices frequently.

B) Budget to mid-range phones have a thin margin.
Many budget and mid-range Android smartphones operate with slim margins. If a crucial component, such as memory, increases prices, it will be more difficult to “absorb” the increase. According to TrendForce, budget lines are now at risk since brands may have no choice but to increase prices or slow sales.

C) Memory upgrades are a big part of ‘perceived value’

The scenario for an Indian buyer is that “8GB/128GB” or “8GB/256GB” is now quite an important purchasing criterion. If for the same price you will now get only 6GB/128GB or if 256GB goes into another pricing bucket altogether, then prices will

Even if phones were assembled within the local market, memory is priced around the globe.
E) These factors will

The local assembly in India has increased, but DRAM and NAND are world-scale traded parts, and many modules are imported or their prices are set according to global contracts. Thus, local assembling cannot protect India totally from global memory inflation.

4) Reasons the stress could continue up to Q3 of 2026

The news that you shared, “stress at least until Q3 2026”, aligns with the Indian telecom and supply chain news that the industry expected the memory pressures to persist till the September quarter of 2026 (Q3CY26).

Trend Force’s announcements also align with the forecasted pattern, expecting a sharp hike in Q1 of 2026 and BOM pressure in 2026.

When you combine: The Birth

anticipated increases in memory prices in early 2026,

the capacity of being pulled towards AI, The objective

cautious expansion from suppliers,

and the time required for new fabs/packaging capacity to be brought on line,

.and it becomes plausible that smartphone brands are faced with cost pressure throughout most of 2026 as opposed to only one quarter.

5) What specific handset manufacturers are going to do in India (the “survival strategies”)

Expect a combination of Pricing Strategies, Spec Swaps, and Portfolio Moves.
Strategy 1: Spec protection—a cut SPEC for marketing models, SPEC cuts elsewhere

Brands understand what sells phones on the basis of headlines:

8GB RAM

256GB Storage

Fast charging

high megapixel resolution

Therefore, they can retain those specifications within a hero model, but depreciate them within:

base variants,

offline-only SKUs

“new launch” phones which are similar in look yet lack storage speed or memory choices.

Indeed, Trend Force has stated the possible way of resisting pressure from BoM as spec downgrades.

Strategy #2 – Aggressive Discounts Reduced (Fewer, Outside Mega Sales)

Rather than relying on constant reductions, trademarks can:

“keep MRPs higher”,

giving discounts only during large events (festive sales),

The best option would be to push the EMI/no-cost EMI option more aggressively instead

“Up the ladder” or Premiumization
The final strategy is related to

Budget segment margins will be squeezed, so the strategies employed by the brands to increase revenue through shifting customers to:

₹20

₹30

and upgrade options to premium tiers

IDC data has revealed that the Indian smartphone market has shown strength in the premium segment in the recent periods, including the performance in Q3 2025, as illustrated by IDC in the premium segment.

Premiumization is attractive, as higher ASPs make it easier for the industry to “hide” component costs.

Strategy 4: Longer Product Cycles, Slower Refresh Cycle

If product stability is an issue in BOM, brands could potentially lower SKU turnover and continue selling models in order to stabilize product procurements.

Strategy 5
Memory configuration becomes more “controlled”

You can see:

“Fewer 512GB choices in mid-tier

smaller jumps between variants (128 → 256 may be more expensive),

slower uptake of high-RAM variants by entry-level phones.

6) What it means for consumers: likely real-world outcomes
As a consumer,

A) Prices could go up, but not necessarily openly

Rather than an overt “₹2,000 increase,” brands may

retain price comparable but cut specifications,

remove charger/in-box accessories

shift a popular spec to a higher variant.

Thus, the buyers are affected by the lack of value for the money.

B. The mid-range phones are affected the worst

Budget phones are already compromise products, and high-end phones have more pricing power. The ‘squeeze zone’ will always be in the mid-range segment, where customers expect radical advancements on a yearly basis, and vendors aggressively fight for market share.

C) More “RAM/storage marketing,” fewer actual upgrades

“12GB RAM” though, in reality, it could be bogging down in:

“Virtual RAM” features (using storage as virtual RAM),

slower storage in some trims,

or less meaningful improvements elsewhere.
D) Replacement cycles may lengthen

If prices escalate and the sense of upgrading becomes smaller, then people could maintain their phones for longer, which would pose pressure on shipments.

Counterpoint has modified 2026 shipment estimates downward because of memory demand driving up BoM costs.

counterpoint

7) Those who are getting affected in India – brands & channels

Mass market Android brands (high volume, low margins)

The brands competing in value segments are usually more vulnerable because:

  1. They might be

“Their costs are rising, so the only way they can maintain market share is

they depend on “spec leadership” which then becomes costly,

they depend on promotional pricing.

Premium Brands (Better Insulation)

In some cases, some of the best players may be less vulnerable to criticism due

They have relatively stronger pricing power,

• They can negotiate contracts for supplies effectively, whereas before, the company

their customers are less price-sensitive.

Industry reports indicated that the high-end brand sector might be relatively protected compared with lower scale and budget-driven car manufacturers during the memory shortage problem.

Traditional Retailing and E-Retailing

Offline is typically dependent on established MRPs + margins.

E-commerce platforms operate through flash sales and discounts.

As a result of memory inflation, the trend of discounting on the internet might become a rare phenomenon, especially in major

8) Realistic timeline: what to expect from now to the third quarter of 2026

“until Q3 2026” can be understood in the following manner:

Phase 1: Late 2025 → Early 2026

The prices for memory increase again (sharp rises in Q1 2026, as predicted by TrendForce).

The Brands now start making changes in the pricing and variants for their launches

Discounts become more selective.

Phase 2
Mid 2026
The market “accepts” a higher cost baseline.

Further spec speculating, some tiers offer fewer options.

The harder brands push financing and premiumization.

Phase 3: Q3 2026 (July –

But if the supply becomes loosened or the demand becomes normalized, then promotional pricing might again creep in.

If the problem of shortages continues, then stress will merely be extended beyond Q3

Nevertheless, some opinions in the market, as well as from major manufacturers, suggest that the market might remain even beyond 2026, which means that the Q3 of 2026 could be a ‘minimum point,’ as indicated by some market analysis. The Verge 9) What buyers can do (smart choices in a high-memory-cost era) If you’re looking to purchase in the next 12 to 18 months, the following are the typical steps that could The first area to prioritize is the storage (128GB vs 256GB) based on your needs If you are recording a lot of video footage and/or photos, 256GB could be worth shelling out the money for, since storage enhancements could become more pricey. Don’t Overpay for “Virtual RAM” Real RAM is an actuality, while virtual RAM is merely an assistant. Time buys around large sale windows If discounts are less common, the best offers are concentrated in major events (festive sales, anniversary sales). Consider looking at last year’s flagships/upper mid-rangers. These phones Since newer models will have a smaller upgrade, it might be a better value to buy older models. 10) The larger picture: Why this all matters beyond cell phones “Memory price” isn’t just an issue with smartphones. There have been similar warnings for PCs and consumer electronics too, and it just goes to emphasize that it’s an ecosystem shift in the supply and demand for AI infrastructure. The Verge +1 That explains why the Indian mobile phone market, with a strong demand in pockets, can still “be under pressure” because the worldwide component cycle intersects with a scenario that demands a refreshed product at a decreased cost each year. Bottom line Memory (DRAM + NAND) prices rising = BoM cost of phones up. Because India is very sensitive to prices, it is not possible to transfer costs without impacting demand. Therefore, the market contradicts via increased prices, decreased discounts, and/or spec downgrades. Various sources indicate the pressure being felt throughout 2026, with the Indian coverage being explicit about the stress being felt until Q3 2026.