Chinese smartphone brands raise prices amid storage chip shortage

Recently, Huawei, Xiaomi, and Honor collectively raised prices for multiple smartphone models, with some models seeing single increases of up to 1,000 yuan, quickly topping the trending topics.

Over the past several days, reporters from the Sci-Tech Daily visited physical stores and found that prices for relevant models have been adjusted. Due to the sudden nature of this price increase, some physical stores had not yet updated their price tags and could only inform customers of the new prices verbally. Online price comparison data also corroborate multiple rounds of adjustments, with heightened online discussion, yet foot traffic at physical stores has shown no significant change.

Behind this round of widespread smartphone price increases, the primary driver is the rising cost of upstream components such as memory chips. Fluctuations in chip prices have also impacted the second-hand recycling market, giving rise to arbitrage activities centered on “dismantling devices to extract chips,” leaving many participants trapped amid these market ups and downs.

Due to cost pressures, the budget smartphone market has rapidly shrunk, leading to a new industry landscape characterized by declining sales volumes and rising average product prices. The domestic smartphone industry is entering a new development cycle.

On September 1, price tags across the mobile phone industry rose collectively. Huawei, Xiaomi, and Honor, the three major Chinese smartphone brands, simultaneously increased prices for multiple models currently on sale, covering the entire price range from budget to premium flagship devices.

Recently, reporters from the Sci-Tech Daily visited two Huawei authorized experience stores—Wujiaochang Shengshenghui and Bailian Youyicheng in Shanghai—and found that this price increase came suddenly and sharply.

Prices for the full Huawei Mate 80 series displayed on demonstration units at authorized Huawei experience stores

The store clerk told a reporter from the Science and Technology Daily that the price increase notice was recently distributed to experience stores via WeChat groups, with price hikes affecting both the Huawei Mate 80 series and the Huawei Enjoy 90 series. All configurations of the Huawei Mate 80 have increased by 800 yuan, with the 12GB+256GB model rising from 4,699 yuan to 5,499 yuan; prices for all variants of the Mate 80 Pro and Pro Max have risen by 1,000 yuan, with the top-spec Pro Max model (16GB+1TB) now priced at 9,999 yuan, officially crossing the 10,000-yuan threshold.

Reporters from the Science and Technology Daily noticed that in some experience stores, the new price tags for the increased-price models had not yet been printed, so staff could only verbally inform customers upon inquiry, "Prices have gone up today."

Although residents in Shanghai can currently receive a 15% subsidy on the purchase price of electronic digital products in-store, with a maximum subsidy of 500 yuan, “you can’t even get a Mate 80 with 512GB storage for 5,000 yuan anymore,” the store clerk remarked.

When asked about the price increase, the staff member said that due to rising costs of storage and other chips, prices for all models of the brand have generally gone up. “If you buy occasionally, you might not notice, but since we’re here frequently, we can feel the price changes.”

Compared to Huawei, Xiaomi updates its price tags more quickly; the Xiaomi Store at the Wujiaochang Mall in Shanghai, visited by a reporter from the Science and Technology Daily, has already completed its price tag updates.

Specifically, the Xiaomi 17 has been raised from ¥4,799 to ¥5,099, an increase of ¥300; the Xiaomi 17 Pro has been raised from ¥5,399 to ¥5,699, also an increase of ¥300; and the Xiaomi 17 Pro Max has been adjusted from ¥6,499 to ¥6,999, an increase of ¥500. This marks the second price increase for Xiaomi’s flagship models within a month, following the previous adjustment on August 2.

The Xiaomi 17 was released last September; we expected a price drop during the 618 sale, but it didn’t decrease much,” the salesperson said. “Previous models were discounted due to excess inventory, but now we only have about a month’s worth of stock. The price increase came suddenly, and it’s unlikely to drop again.”

In some Glory stores, price tags from before are still displayed, but the prices have changed.

According to an official notice from Honor, the Honor Power 2 with 12GB+256GB and 12GB+512GB configurations have each increased in price by RMB 500 and RMB 600, respectively; various versions of the Honor Magic 8 have increased in price by RMB 300 to RMB 500.

Reporters from the Science and Technology Daily noticed that store staff appeared uneasy when customers expressed interest in purchasing the Magic series: "The current price is incorrect—if you'd like to buy, let me check for you."

This is the first time the Magic 8 has increased in price since it was launched. When other brands raised their prices, the Magic 8 never did,” the salesperson revealed to a reporter from the Science and Technology Daily. Currently, the only model in the Honor Magic series that has not been price-increased is the Magic 8 Pro Air.

Beyond store visits, reporters from the Science and Technology Daily tracked price trends on Taobao's official flagship store using a price comparison mini-program. Data shows that models from Huawei, Xiaomi, and Honor with similar pricing simultaneously increased on September 1, while certain variants of the Xiaomi 17 and Honor Magic 8 had already undergone two significant price hikes within August.

Price trends of the top three brands over the past month

Specifically, the Xiaomi 17 with 12GB+256GB storage was priced at 4,999 yuan after its first price increase on August 2, remained largely at this level until a brief reduction from August 30 to 31, then sharply rose to 5,199 yuan on September 1. The Huawei Mate 80 with 12GB+256GB storage stayed between 4,799 and 4,999 yuan from July 31 to August 31, then increased to 5,174 yuan on September 1. The Honor Magic 8 with 16GB+512GB storage was priced at 4,699 yuan on August 1, jumped to 4,999 yuan on August 2, fluctuated slightly around this level afterward, and surged again to 5,499 yuan on September 1—an overall increase of 800 yuan within one month.

It is worth noting that on September 1, “Several smartphones officially raised prices” instantly rose to the top of Weibo’s hot search list.

During their on-site visit, a reporter from the Science and Technology Daily observed that, despite heated online discussions, foot traffic in physical stores showed no significant change compared to other weekdays. “If you’re hesitating about whether to buy, it means you don’t really need it,” one consumer told the reporter, adding that they could wait for the year-end sales.

Beyond the price increases on new devices, the hidden currents in the second-hand recycling market are also worth noting. Recently, reporters from the Science and Technology Daily visited multiple phone recycling shops in Huaqiangbei, Shenzhen, and found that the real driver behind the rising recycling demand is not the brand price adjustments on September 1, but the sustained surge in storage chip prices over the past year.

A shop owner told the Science and Technology Daily that the price increase of new branded devices will lead to a corresponding rise in recycling prices for those models, but the overall change is minimal; previously, the sharp rise in storage chip prices had driven up both recycling and second-hand selling prices.

A recycler told the Science and Technology Daily that although the price increase of new devices may slightly raise the resale values of corresponding models, the overall change is limited: “Like-new used phones are about 200 to 300 yuan more expensive than before.” According to their quotes, the resale price for a like-new Huawei Mate 80 with 256GB storage is around RMB 3,300, while the 512GB version is approximately RMB 3,800.

When a reporter from the Sci-Tech Daily inquired about the buyback price, saying they wanted to sell a one-year-old Xiaomi 17, the shop owner replied that an evaluation requires inspecting the physical device: “Factors such as condition will affect the buyback price; currently, the maximum we’d offer for a Xiaomi 17 is around 2,000 yuan.”

What truly signaled a shift in the market to Shenzhen Huaqiangbei recyclers, more than price hikes on new branded devices, was the fundamental restructuring driven by rising chip prices.

The AI boom has consumed global storage chip capacity, causing significant price increases for general-purpose mobile memory and advanced-process chips, leading to passive price hikes for new devices," said Chen Shenyu, Manager at CIC灼识Consulting, to the Science and Technology Daily. "The thriving recycling market in Huaqiangbei operates on a disassembly arbitrage model: damaged or water-damaged phones are collected, their high-capacity memory chips removed, then cleaned and re-balled before being downgraded for use in automotive components, IoT hardware, or refurbished devices overseas."

However, this is not a guaranteed profit-making venture.

According to reporters from the Science and Technology Daily, Shenzhen’s Huaqiangbei scrap device recycling market has just experienced a dramatic rollercoaster ride. At the peak of the price surge, the recycling price for a single scrap device rose from under 100 yuan to over 200 yuan. However, in late March this year, market conditions shifted abruptly, with mainstream memory prices dropping more than 40% within a month, prompting many recycling shops to stop accepting scrap phones.

Chen Shenyu also pointed out to the reporter from the Science and Technology Daily that this is a speculative arbitrage behavior resulting from short-term supply-demand imbalances in the industrial chain. “Refurbished chips carry yield losses and compatibility risks, and downstream low-end markets have limited absorption capacity; once upstream semiconductor manufacturers adjust their production capacity, this recycling premium will quickly disappear.”

“The market won’t always be this good—many people bought in large quantities before, and now they’re stuck with inventory,” said a shop owner, speaking to a reporter from the科创板Daily. “When the trend is up, it’s a business opportunity; when it fades, all that’s left is stock.”

On one side, new branded phones have increased in price, yet customer traffic remains unchanged; on the other, the mobile phone recycling business has experienced wild fluctuations—both perfectly illustrating the two sides of this round of smartphone market price adjustments. Their common driving force points to one source: memory chips. And the price volatility of memory chips is fundamentally rewriting the cost structure of the smartphone industry.

Counterpoint Research data shows that smartphone memory prices rose by more than 80% quarter-over-quarter in the second quarter of 2026. Additionally, the share of storage chips in the total BOM cost of smartphones has surged from 10% to 15% in the past to over 20%, with entry-level and mid-range models approaching 30%.

Among the main components of mobile phones, almost everything except the screen has seen price increases, including storage, SoC, PCB, and MLCC,” said Guo Tianxiang, Research Manager at IDC China, to The科创板Daily. “Qualcomm has already notified customers of price hikes starting in September. While the rate of increase for storage will slow compared to the first half of the year, prices will continue to rise.”

Since March, mobile phone prices have undergone multiple rounds of increases, and Guo Tianxiang predicts that prices of new models from various brands starting this month will continue to rise.

Shenghao Bai, Senior Analyst at Counterpoint Research, also believes that this price increase is primarily driven by rising costs of key upstream components. “Storage chip prices remain high and are expected to continue rising through the second half of 2026, albeit at a slower pace. SoC chip prices have also recently increased. Currently, this trend is expected to persist in the short term.”

Under cost pressure, smartphone manufacturers' pricing strategies are undergoing fundamental changes. Chen Shenyu, Manager at CIC灼识Consulting, believes that with current high points in the chip and memory cycles, the hardware costs of processors, memory, displays, and batteries have become extremely high. Combined with mold development and channel commissions, producing budget phones below 1,000 yuan is likely to result in losses, forcing manufacturers to discontinue their low-end product lines.

According to IDC data, smartphones priced below RMB 1,000 accounted for 22% of the market share in 2023, but this share plummeted to just 2.7% by the first quarter of 2026. Major brands such as OPPO, vivo, Xiaomi, and Honor have completely discontinued sales of devices priced below RMB 1,000.

Counterpoint Research senior analyst Ivan Lam noted that the impact of rising memory costs in the second half of the year will become more pronounced, affecting all manufacturers. “Sales of traditional mid- to low-end smartphones, especially models under 2,000 yuan, will face even greater challenges, but the actual impact will not be limited to the mid- and low-end markets—mid- to high-end models will also find it difficult to fully avoid the effects.”

Notably, IDC has released a report projecting that global smartphone shipments will decline by 16.7% year-over-year in 2026, marking the largest drop in history, while the average selling price is expected to reach $581, an increase of 27.6% year-over-year.

Sell less, sell at higher prices—the smartphone market is entering a new cycle. But for China’s smartphone industry, whether this price increase is a stepping stone toward a technology premium or a reluctant response to pressure remains to be seen.

This article is from the WeChat public account "Cailianpress," authored by Li Jiayi and Huang Xinyi.