Smartphone shipments across the Middle East, excluding Turkey, fell 19% year over year to 10.6 million units in the second quarter of 2026, according to Omdia, as higher prices, supply constraints and geopolitical uncertainty weighed on demand. Weaker consumer confidence also prompted retailers to take a more cautious approach to inventory, making the decline the steepest since the fourth quarter of 2025.

Lower-End Demand Weakens First

Manufacturers continued passing higher component costs on to consumers while focusing on mid-range and premium devices, where margins are stronger. Shipments of smartphones priced below $200 fell 42% year over year, with Iraq reporting a 36% decline as markets reliant on low-cost devices came under greater pressure.

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Mid-Range Becomes Strategic Battleground

The mid-range segment has become a key competitive category as manufacturers retain features such as memory, storage, cameras, battery capacity and artificial intelligence capabilities while managing higher costs. Shipments of devices priced above $300 rose 16% year over year, while smartphones with 256GB of storage accounted for 55% of all shipments.

Premium Demand Proves Resilient

Shipments of smartphones priced above $800 reached 1.9 million units, the highest second-quarter total on record for the segment in the Middle East. Apple was the primary driver of that growth, while the United Arab Emirates and Qatar recorded stronger demand for premium devices.

In the UAE, a mature retail network and installment financing helped limit the market decline to 7%, while Qatar posted 2% growth, supported by stable economic conditions and continued demand for premium smartphones.

Average Selling Prices Rise

The shift toward higher-priced devices pushed the region’s average selling price up 25% year over year to $448, the highest second-quarter figure on record. Manish Pravinkumar, principal analyst at Omdia, said the market reflects “a convergence of necessity and strategy” as vendors seek to protect competitiveness and brand positioning while accepting some volume loss.

“Prioritising profitability and revenue over volume has become critical in an increasingly challenging operating environment, even at the expense of short-term results,” Pravinkumar said, adding that the reset reflects lessons from earlier cost cycles when aggressive discounting weakened profitability.

Vendor Performance Reflects Different Strategies

Samsung remained the region’s leading vendor with a 39% market share despite a 7% decline in shipments, balancing its volume-focused Galaxy A series with Galaxy S26 models aimed at protecting margins. HONOR, the second-largest vendor, grew 2%, while TRANSSION and Xiaomi, ranked third and fourth, respectively, saw shipments fall 40% and 50% as rising prices weakened entry-level affordability.

Apple grew 1% from the second quarter of 2025, supported by steady premium demand, its ecosystem and continued consumer financing.