Omdia: 2026 will be a critical year for AI competition. It is expected that the Chinese smartphone market will still have strong resilience.

On June 11th, Omdia stated that 2026 will be a key year for AI competition. Despite the rising cost pressures, the Chinese smartphone market is expected to remain resilient. With memory costs continuing to rise, the pricing system of the smartphone market is accelerating its adjustment. In the fiercely competitive price range of $100-300, brands such as OPPO, vivo, and Honor have started adjusting their pricing and product strategies to cope with the pressure on profits. In contrast, Apple and Huawei, with stronger high-end brand power and product structure advantages, are showing stronger risk resistance under cost pressures and are expected to further consolidate their high-end market share in the process of market redistribution. At the same time, policy support will continue to have a buffering effect on the market in 2026. Despite differences in the implementation of previous consumer subsidy policies on the ground, it is expected that subsequent national-level incentive measures will continue, especially during key consumption periods such as the Spring Festival, which will help stabilize overall demand performance. What truly drives industry change is the structural transformation brought about by AI. From early explorations like "bean bag phones" to the rapid penetration of system-level AI capabilities, Chinese smartphone manufacturers are accelerating their upgrade from the product level to the AI experience and ecosystem level. However, a deeper level of competition is unfolding: Smartphone manufacturers vs. Internet platforms Competition around AI entry points and user experience control This means that industry competition is shifting from "hardware competition" to "AI ecosystem and entry point competition." Overall, the Chinese smartphone market is not simply facing cost pressures, but is entering a new phase of structural reshaping under the drive of AI: high-end, ecosystem, and AI-driven developments are simultaneously accelerating, and the industry landscape will continue to evolve accordingly. The industry competition logic is shifting from traditional hardware and configuration competition to systematic competition around AI entry points and ecosystem control.