Premium phones surged as Middle East smartphone market shrank in Q1 2025

You’d think a flashy end-of-year sales season would carry some momentum into 2025. It didn’t. Across much of the Middle East, shoppers hit the brakes on smartphone spending in Q1—even with the discounts, even with the promos, and the region's smartphone market took a step back.

According to Canalys, overall smartphone shipments across the Middle East (excluding Turkey) fell 4% year-on-year to 11.7 million units. The region, which bounced back strongly in 2024, is losing steam as consumers tighten their spending amid growing economic uncertainty.

In key markets like Saudi Arabia, the biggest in the region with a 26% share, shipments dropped 12%—a sharp correction as Ramadan spending shifted toward lifestyle categories like travel and food, sidelining tech purchases. Iraq followed a similar trend, down 11%, hit hard by oil-related fiscal pressures.

The UAE bucked the trend, dipping just 1%. Strong Eid retail activity and growing tourist inflows helped soften the blow. Kuwait and Qatar, however, were the real outliers. Kuwait posted 13% growth, driven by festival-season promotions from major retailers like Xcite and Eureka.

Qatar led the region with a 16% jump in shipments, powered by more than 1.5 million tourist arrivals, a booming luxury sector, and a digitally savvy population combined to make it the region’s strongest growth story.

Behind the slowdown is a clear shift in consumer behaviour. While overall volume declined, high-end smartphones are gaining traction. Shipments of devices priced above $600 grew 17% year-on-year, signalling rising demand for premium experiences. Samsung saw 19% growth, led by its Galaxy S25 Ultra, which accounted for 9% of its shipments. Apple also posted solid gains with 10% growth, driven by strong iPhone 16 demand and the growing popularity of buy-now-pay-later plans.

Meanwhile, value brands are facing new headwinds. TRANSSION, which leads the sub-$100 segment, saw its market share fall to 43%, down from 51% last year, as competition stiffened. Xiaomi struggled too, dropping 31% amid inventory changes. Conversely, HONOR and Motorola saw momentum, posting 36% and 12% growth, respectively.

The Middle East smartphone landscape is clearly shifting. Growth is becoming more selective, with high-end models driving value and low-cost leaders facing stiff competition. As consumer priorities evolve, brands that can either scale affordability or deliver premium appeal will be the ones to watch through the rest of 2025.