The Middle East and Africa (MEA) region closed 2025 on a positive note for smartphone sales, but market researchers are warning that the momentum is unlikely to hold through 2026 as a global memory chip shortage begins to squeeze supply chains and drive up device costs.
Smartphone shipments across the MEA rose 5% year-on-year in the fourth quarter of 2025, marking the region’s third consecutive quarter of growth, according to Counterpoint Research’s latest Market Monitor report released on March 3. The expansion was driven by accelerating adoption of fifth-generation (5G) devices, a consumer shift toward higher-end handsets and improving economic conditions in several markets.
However, Counterpoint now expects MEA smartphone shipments to decline by 19% in 2026, the steepest projected fall among all major regions globally, as memory shortages, rapid component price inflation and structural vulnerabilities among lower-end device makers combine to reverse recent gains.
Samsung Surges, Chinese Brands Squeezed
Samsung recorded 53% year-on-year volume growth in Q4 2025, reclaiming the top position in the MEA by strategically building up lower-cost inventory ahead of anticipated price increases and the approaching Ramadan sales season. The move allowed the South Korean manufacturer to outpace rivals already feeling the effects of tighter component supply.
Chinese brands bore the early pressure from the shortage. Transsion and Xiaomi recorded shipment declines of 4% and 14% respectively in the quarter as the memory crunch, which took hold in mid-2025, disrupted their Q4 production cycles. HONOR bucked the trend, posting 83% year-on-year growth, though Counterpoint attributed much of that to a low comparison base and resilient existing inventories rather than underlying demand.
5G Surges but Affordability Window Closing
5G smartphone shipments across the MEA surged 22% year-on-year in Q4 2025, supported by expanding network infrastructure in markets including Egypt, Morocco, Tunisia and Sierra Leone. Affordable 5G handsets and consumer financing options helped broaden access beyond the premium segment.
The US$100 to US$249 price band grew 28% year-on-year, while the above US$700 segment expanded 46%, reflecting simultaneous growth at both ends of the market. Feature phone users migrating to basic smartphones supported the entry tier, while premiumisation and trade-in programmes drove the high end.
Counterpoint identified the MEA as the world’s largest market for sub-US$150 devices, making the region disproportionately exposed to the ongoing dynamic random-access memory (DRAM) shortage now hitting the budget segment hardest. Researchers said device makers are likely to respond through feature reductions rather than price cuts, a trend the firm described as “feature shrinkflation.”
Outlook
Counterpoint expects the downturn to extend through 2027, with a recovery projected only in late 2027 as additional memory production capacity comes online. Brands with limited ability to absorb or pass on rising costs face the greatest risk, with the firm warning that smaller manufacturers may be forced to reassess long-term viability as the industry consolidates around fewer, stronger players.
