Southeast Asia smartphone shipments contract in Q3 2025 as cost crisis hits

The energy around smartphone launches has not disappeared in Southeast Asia, but the momentum underneath has shifted. What used to be a steady climb has become a more cautious market, shaped by tighter budgets, rising costs, and an entry segment that is increasingly volatile.

That strained environment set the stage for Q3 2025, where the region posted its third consecutive quarter of contraction, with shipments totaling 25.6 million units, a 1% YoY decline, according to the latest research from Omdia (formerly Canalys).

Sales slowed as consumers weighed their purchases more carefully. Vendors, still recovering from a soft first half, managed shipments more tightly to avoid overstocking. And the part of the market that once drove the bulk of volume, smartphones priced under $200, has become the most difficult to forecast.

Omdia Research Manager Le Xuan Chiew notes that the entry tier “is becoming increasingly challenging to manage,” even though it remains central to volume leadership.

Compounding this volatility is the crushing pressure of rising costs, especially for memory and storage components. Omdia highlights that this cost squeeze matters intensely because more than 60% of all smartphones shipped in the region sit below the $200 mark. Higher Bills of Material (BoM) mean many brands can no longer rely on aggressive low-end pricing without sacrificing margins.

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The Top Contenders

Against this backdrop of contraction and rising costs, the fiercely competitive landscape produced an unprecedented result: a dead tie for first place.

Samsung and TRANSSION tied for the lead, both commanding an 18% share with 4.6 million units shipped. Samsung leveraged its strength with a premium-leaning portfolio in higher Average Selling Price (ASP) markets like Thailand, Vietnam, and Malaysia, using these offerings to offset gains made by competitors in more price-sensitive areas. Meanwhile, TRANSSION (makers of Infinix and TECNO) maintained its position and achieved modest year-on-year growth by dominating those key price-sensitive markets.

Close behind in third place was Xiaomi, seizing a 17% share with 4.3 million units. Xiaomi’s surge was primarily due to the success of its POCO series, which saw shipments more than doubling year-on-year following the introduction of new entry-level models.

However, not all top five players fared as well; OPPO ranked fourth with a 15% share (3.8 million units), reflecting a significant annual contraction attributed to softer demand and necessary channel correction. Finally, vivo completed the top five with an 11% share (2.9 million units), lifted by new Y-series SKUs that successfully complemented its V-series mid-range lineup.

These performances reveal a widening split in vendor strategy. OPPO and vivo are prioritizing value and margin stability, stepping back from volume at any cost. Xiaomi and HONOR are leaning into volume to expand brand reach. 

Different Countries, Different Winners

At the country level, the region showed just how fragmented it has become. In Indonesia and the Philippines, TRANSSION led shipments, with its competitively priced Infinix and TECNO models resonating strongly. Sheng Win Chow, Senior Analyst at Omdia, points out that this volume leadership is now under threat, as rising memory and storage costs could challenge TRANSSION's ability to maintain such aggressive pricing.

Meanwhile, in Thailand and Vietnam, Samsung maintained a commanding lead in two of its traditionally strongest markets, demonstrating resilience as it defended share against heightened competitive pressure. Samsung’s earlier rollout of the A17 and A07 series played a key role in Q3 25, helping it respond quickly in the entry- and mid-range segments.

Finally, in Malaysia, Xiaomi took the top spot, driven by the strong September launch of the Redmi 15, including the early release of the 5G variant, highlighting its ability to deliver affordable 5G devices as mass-market adoption accelerates.

Outlook

With rising BoM costs, there is an increasing volatility in the budget segment ($200 and below), which is pulling the entire market down. This segment, which is the market’s volume engine, has become its most financially constrained and unpredictable component.

In the quarters ahead, vendors will have to choose between adjusting consumer prices (risking share loss), reducing hardware costs (potentially compromising the user experience), or scaling back marketing (sacrificing brand presence) to protect margins. Vendor success will ultimately be determined by the ability to manage a volatile supply chain and execute perfect cost-to-volume balancing acts