Huawei, Xiaomi and Honor raise smartphone prices as memory costs surge

by HOU Ruining

Huawei, Xiaomi and Honor raised prices on a range of smartphones in China on September 1, with increases of as much as 1,000 yuan (US$140), as rising memory-chip costs put fresh pressure on hardware margins.

Huawei lifted prices across its Mate 80 series by 800 yuan, with premium Pro models becoming 1,000 yuan more expensive. Xiaomi raised prices on several models in its Xiaomi 17, Redmi K90 and Turbo ranges, while Honor also increased prices on selected Power and Magic devices.

The latest increases are part of a broader repricing across China's smartphone market this year. Oppo announced price increases on several handset lines in March, while Vivo and Oppo raised prices on additional models during the summer, according to Chinese state broadcaster CCTV.

The immediate pressure is coming from memory chips.

Strong demand for AI server computing has created a powerful pull on memory supply. Samsung Electronics, SK Hynix and Micron have shifted an estimated 70% to 90% of their advanced production capacity toward higher-margin high-bandwidth memory, or HBM, used in AI systems. That has continued to squeeze capacity for consumer DRAM and NAND flash, widening the supply gap, driving up prices and pushing higher component costs through to smartphones.

Chinese media outlet Blue Whale News (lanjinger.com) reported that DRAM contract prices rose 340% year on year in the first half of 2026, while NAND prices increased 320% over the same period, significantly increasing the bill of materials for flagship smartphones. Memory, once a relatively modest share of handset production costs, is now taking up a much larger portion of the total for some premium devices.

Executives at Huawei and Xiaomi had already warned that the trend could feed through to retail prices.

Richard Yu Chengdong, Huawei's executive director and chairman of its consumer business group, said at an August product launch that sharply higher memory prices could force widespread handset price increases if manufacturers were to avoid selling devices at a loss.

Xiaomi president LU Weibing said in May that some Chinese flagship smartphones could move above the 10,000 yuan price point in the second half of the year.

The increases come at a difficult time for China's smartphone market.

IDC data shows that smartphone shipments in China continued to decline in the first half of 2026, extending a run of year-on-year contractions as replacement demand remained weak.

That combination of softer demand and rising component costs is forcing handset makers to rethink pricing, product positioning and, in some cases, their market strategies.

Some smaller brands are already shifting resources elsewhere. Oppo said in July that Realme would focus upcoming products on overseas markets and pause product updates in China. Meizu said earlier this year that it would suspend new domestic smartphone launches while putting greater emphasis on overseas handsets, AI glasses and software products.

For smartphone makers, the challenge is becoming increasingly clear: the AI boom is boosting demand for the same memory supply chain they rely on, while consumers at home are becoming more cautious about upgrading.