According to Counterpoint Research's weekly sales tracking data for China's smartphone market, sales in the first nine weeks of 2026 fell by 4% compared to the same period in 2025. Despite the introduction of government subsidies at the start of the year, overall demand remained weak based on market performance in the first two months. Promotional activities by domestic brands during the Spring Festival in February led to a sales recovery from January; however, rising memory prices limited the extent of discounts, resulting in a 2% year-on-year decline in sales during the holiday period and the preceding three weeks.

Persistently increasing memory costs are exerting growing pressure on downstream manufacturers. In response, several Chinese manufacturers have officially announced price increases for some existing models. These adjustments also serve to gauge market sensitivity to pricing, helping companies assess consumer acceptance of higher prices ahead of new product launches and providing a reference for setting prices of next-generation models. Should sales be significantly impacted, manufacturers are prepared to adjust prices promptly.

Apple achieved robust sales growth in the first nine weeks, with a 23% year-on-year increase, driven by discounts on e-commerce platforms and the eligibility of its base model iPhone 17 for government subsidies. Leveraging its supply chain advantages, Apple is well-positioned to navigate the current memory supply challenges. While Android manufacturers have announced price hikes, Apple has not followed suit, opting instead to absorb some profit pressure and use the situation to expand its market share.

Collaborations with domestic memory chip suppliers are expected to help Huawei secure sufficient memory chip supplies despite global price increases. Huawei is likely to leverage this opportunity to capture more share in the mid-to-low-end market segments. Looking ahead, China's smartphone market is projected to remain under pressure from March to May, with a potential rebound in early June driven by 618 shopping promotions. Rising memory costs are anticipated to persist throughout 2026, compelling smartphone brands to make trade-offs between cost, profit margins, and shipment targets. Brands relying on entry-level models to drive market share will face heightened challenges.