Omdia predicts that demand for new smartphones throughout 2026 will shrink by about 12 percent as consumers increasingly choose refurbished devices. The company warns that smartphone prices may not decline even though RAM prices have dropped.
Omdia, a technology market research firm, revealed that in the first quarter of 2026, the number of display panels sent to the refurbished mobile phone market rose 20 percent year-on-year, reaching 298 million units. This surpassed the 289 million panels supplied for new phones, marking the first time the refurbished segment overtook new devices. The only segment still growing was the secondhand market.
Omdia’s definition of the refurbished market extends beyond selling used phones to shops; it also includes display panels sent for user repairs, professionally refurbished recycled devices, and aftermarket replacement parts. Thus, Omdia’s figures cover both screen replacements for broken displays and old devices resold.
Regarding display technology, in Q1 2026, OLED screens accounted for 7 percent of refurbished panels, up 2 percent from the previous year, while the remainder were LCDs. This indicates that premium smartphones from three to four years ago are circulating back into consumers’ hands.
This trend stems from soaring memory prices, which pushed up related component costs. Smartphone manufacturers had to reduce production plans, causing orders for new phone displays to fall short of expectations. Omdia estimates that demand for new phone displays will decline 12 percent throughout 2026. Display factories cannot quickly cut capacity due to long-term investment in production lines, so excess panels are likely diverted to repair shops or smartphone parts retailers.
For new smartphones overall, global shipments in Q2 2026 fell 6 percent to 272 million units, down from 288.9 million in the same period the previous year.
Notably, the impact was uneven across brands. Xiaomi saw the steepest decline at 26 percent, shipping 31.2 million units, marking its second consecutive quarter of decreases. More than half of Xiaomi’s shipments were in the sub-$200 segment (around 6,600 baht), a segment now unable to absorb rising component costs.
OPPO, including OnePlus and realme, declined 17 percent to 28.4 million units after cutting low-cost models to maintain profit margins. Vivo dropped 18 percent to 21.5 million units.
However, Samsung and Apple were the only brands still growing. Samsung shipped 60.5 million units, up 5 percent, holding a 22 percent market share. Its advantage came from producing its own memory, mitigating component shortages, plus premium demand boosted by delayed Galaxy S26 launches and gaining entry-level market share as Chinese brands cut models and raised prices.
Apple shipped 55.1 million units, up 23 percent, capturing a 20 percent market share—the highest ever for Q2. Omdia noted that part of this growth resulted from dealers stockpiling the iPhone 17 in anticipation of a pricier iPhone 18 launch.
Omdia also assessed that smartphone prices are likely to remain high even after the memory cost crisis subsides, as consumers have adjusted to these price levels. This allows manufacturers to maintain elevated pricing, shifting the market into a phase focused more on profitability than volume growth. Shipments are expected to decline for at least two more quarters despite promotional efforts, with overall market recovery dependent on further component cost reductions.
To cope with higher prices, brands are attracting consumers through installment plans, bundled sales, and trade-in programs. However, traded-in devices are refurbished and resold in the refurbished market, creating a cycle where brands compete against their own secondhand products.
Cost issues are also affecting the wearable device market, as rising memory and storage costs push up average selling prices, evidenced by price increases for Samsung’s Galaxy Watch, among others.
. TNW