Diwali smartphone sales fall 18-20% at mobile shops, AIMRA says

Smartphone sales at India's mobile phone shops fell by 18% to 20% in units during the Diwali 2026 festive period compared with last year, the All India Mobile Retailers Association (AIMRA) said in its Diwali retail performance report, published in the week of 11 November 2026. Customers kept coming into stores, the association said, but many left without buying because phone prices had gone up. The value of sales stayed roughly flat, as each phone sold cost more.

Diwali is normally the biggest selling season of the year for India's neighbourhood mobile shops. A fall of a fifth in the number of phones sold in that window hits the income of small retailers, who earn a margin on each unit. Flat sales value does not fully protect them: a shop that sells fewer phones at higher prices often has the same costs of rent, staff and stock to cover, with fewer customers to spread them over.

The cause, according to the association, lies far from the shop counter. Phone makers are paying more for memory chips, a rise that coverage links to heavy demand for memory from the AI industry. One brokerage report cited in coverage put the cost of memory in an average phone at $60 to $65, about three times the level of 2025. Brands have passed these costs on, especially in the cheaper models that most Indian buyers choose, and the higher prices have put off price-sensitive customers.

The retail figures match the wider market. Counterpoint Research data reported this week showed smartphone shipments in the July-September quarter falling to about 35.8 million units, the lowest third-quarter level since 2016. Weaker phone sales also matter beyond the shop, for consumer loans that finance many purchases and for India's electronics manufacturing chain.

Peepals calculation: If unit sales fell 18% to 20% while total sales value stayed flat, the average price of a phone sold must have risen by about 22% to 25% (1 ÷ 0.82 ≈ 1.22; 1 ÷ 0.80 = 1.25). A memory cost of $60 to $65 per phone, about three times around $20 in 2025, means an extra $40 to $45 of memory in each device. Our calculation from the reported figures.

Short-term: Mobile retailers enter the post-festive months with weaker sales and the prospect of further price rises, which AIMRA says could cut volumes sharply through early 2027.

Long-term: If memory prices stay high, cheap smartphones may become harder to sell profitably, pushing buyers to keep old phones longer or to buy refurbished ones. Brands that cut launches and offers risk losing shelf space with retailers.

Who is affected: Small and mid-sized mobile phone retailers, their staff, phone brands that depend on offline sales, and households planning to buy or upgrade a phone.

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