According to the latest research from Omdia, smartphone shipments in the Southeast Asian market for the first quarter of 2026 declined by 9% year-on-year, totaling 21.6 million units. However, the most notable market development is not the shipment drop but the change in Average Selling Price (ASP). Driven by rising memory costs, the ASP for smartphones in Southeast Asia reached a record high of $349 in Q1 2026, marking a 19% increase year-over-year.

This divergence of "declining volume but rising prices" clearly indicates that the Southeast Asian smartphone market is undergoing a structural repricing phase. Major brands are shifting their focus from solely pursuing shipment growth to improving ASP and protecting profit margins. Some manufacturers are even willing to accept significant shipment declines in exchange for healthier per-unit profitability.

With DRAM and NAND costs continuing to rise substantially between 2025 and 2026, the highly price-sensitive demand structure of the Southeast Asian market is under increased pressure. Currently, over 60% of smartphones sold in Southeast Asia are priced below $200, making the impact of cost increases particularly acute in the mass-market segment.

In Q1 2026, Samsung (005930.KS) led the Southeast Asian market with 4.6 million shipments and a 21% market share, achieving 4% year-on-year growth. This growth was primarily driven by the strong launch performance of the Galaxy S26 series and sustained sales from its A-series models.

OPPO ranked second with 4.2 million shipments. However, due to operational adjustments related to its integration with realme, its shipments fell by 17% year-on-year.

Xiaomi (01810.HK) took third place with 3.7 million shipments. The company's shipment performance was pressured by a decline in channel procurement willingness due to price increases across its entire product line and constrained consumer budgets.

Transsion ranked fourth with 3.4 million shipments, a 10% year-on-year decrease. Its brands, Infinix and TECNO, which focus on high cost-performance, continued to solidify their positions in markets like Indonesia and the Philippines.

vivo secured fifth place with 2.1 million shipments, representing a 27% year-on-year decline. The brand is shifting its strategic focus toward profitability, consequently reducing its investment in the entry-level, low-price segment that previously supported its shipment volume.

Apple (AAPL.US) ranked sixth with 1.8 million shipments, remaining largely flat year-on-year. Notably, the iPhone 17 series performed strongly, and its price discounts during the same lifecycle stage were significantly lower than those of the previous generation.

Among all manufacturers, Honor emerged as the standout growth brand, with shipments increasing 28% year-on-year to 1.2 million units. Against the backdrop of an overall market decline in Southeast Asia, Honor achieved shipment growth in six out of eight Southeast Asian markets.

A research manager at Omdia commented, "The most defining market characteristic of Q1 2026 was the record-high smartphone ASP occurring alongside a simultaneous shipment decline—these two trends are directly linked. Rising memory costs have increased the overall device Bill of Materials (BOM), especially in the entry-level and mid-range segments, where DRAM and NAND constitute a higher proportion of the product cost. Faced with this pressure, manufacturers are raising prices on one hand and more strictly controlling supply on the other to prevent channels from reverting to a state reliant on heavy discounts. For a market where the majority of sales come from products priced below $200, this presents a very difficult choice: either pass the cost to consumers and risk losing sales, compress their own profit margins, or reduce product specifications. Whichever path is chosen inevitably comes with a cost."

The divergence between shipment volume and market value remained the most distinct feature of the Southeast Asian smartphone market in Q1 2026. While overall shipments fell 9% year-on-year, market sales value grew by 8%, indicating that this growth stemmed primarily from repricing rather than a structural expansion of demand.

Amid the overall weak shipment environment, vivo and OPPO were the major brands with the most significant ASP increases, rising 28% and 26% year-on-year, respectively. This reflects both companies' proactive efforts to reduce shipments of low-margin entry-level products and shift toward a development strategy more focused on profitability.

In contrast, Honor and Samsung utilized this period to continue increasing investments in brand building and channel expansion, accelerating their market share gains.

This dynamic is also evident at the product strategy level. For example, in the Malaysian market, Xiaomi eliminated the 4G version of its Note 15 series, effectively steering basic users toward higher-priced 5G models (the starting price for the Note 14 4G was RM699, while the Note 15 starts at RM849, with adjustments and reductions to the base memory configuration). In the higher-end product line, the starting configuration for the Note 15 Pro+ has also been elevated, with the 12GB/512GB version priced at RM1,899 compared to RM1,599 previously.

Overall, this reflects an industry shift from "relying solely on specification upgrades" to "passing on rising component costs through forced configuration upgrades and higher default memory specs" rather than depending on traditional incremental feature enhancements.

In Singapore, Honor broke into the top three for the first time, primarily due to its strong execution in retail channels and the market pull of its mid-range product portfolio, especially the X9d series. This performance also highlights that in certain mature markets, manufacturers can still achieve share growth through precise channel and product strategies.

Looking ahead to the second half of 2026, the analyst further noted, "As BOM costs continue to rise, whether a strategy reliant on shipment-driven growth can be sustained will become a key question."

At the country level, market performance was more varied than the regional aggregate data. Indonesia, the largest market in Southeast Asia with 7.2 million shipments, experienced the most significant absolute decline, down 17% year-on-year. This was mainly due to continued inventory digestion from the channel stock accumulated in Q4 2025, coupled with cautious consumer sentiment under persistent price pressures. Additionally, weaker-than-expected sales during the Ramadan season and recent retail price increases further dampened replacement demand. Given Indonesia's strategic importance for most Android manufacturers, the slowdown in this market had an amplified effect on the region's overall performance.

The Thai market performed relatively steadily, achieving 2% growth. This was primarily supported by Samsung's stronger positioning in the premium and upper mid-range segments, which partially offset the continued weakness in entry-level demand.

Meanwhile, Vietnam and Malaysia saw year-on-year declines of 12% and 19%, respectively, primarily pressured by a significant contraction (over 30%) in shipments within the below-$200 price segment.

A senior analyst at Omdia stated, "This trend reflects a more severe adjustment occurring in the low-end market, which has noticeably dragged down overall country-level market performance."

"The 'overstocking and subsidy-driven shipment strategy' that dominated the Southeast Asian smartphone market in previous quarters is now reversing. Sales channels in several key segments are gradually moving toward a tighter inventory state, while manufacturers have regained control over pricing cadence and possess stronger control over retail ASPs. Omdia expects this trend to continue through 2026, but downside risks are rising. As broader global macroeconomic weakness and persistent inflationary pressures continue to constrain consumer spending, additional demand-side pressures are anticipated in the second half of 2026, potentially further increasing market uncertainty."