Key Takeaways
- Xiaomi unveiled the Xiaomi 17 and 17 Ultra worldwide at Mobile World Congress, maintaining prices at 999 euros and 1,499 euros
- Memory chip costs have climbed 80–90% during Q1 2026, with AI data center demand redirecting supply away from smartphone manufacturers
- IDC projects global smartphone shipments will contract 12.9% in 2026 because of component shortages
- Xiaomi faces greater vulnerability compared to Apple and Samsung due to its limited premium device portfolio for cost absorption
- Xiaomi’s electric vehicle division grew nearly 200% in the most recent quarter, counterbalancing a 3% decline in phone sales
Xiaomi revealed its Xiaomi 17 and 17 Ultra flagship lineup to global audiences on Saturday during Mobile World Congress in Barcelona.
The Xiaomi 17 carries a starting price of 999 euros ($1,179), while the Xiaomi 17 Ultra begins at 1,499 euros. Both models maintain the same pricing structure as their predecessors from last year.
This pricing strategy stands out against current market conditions. Memory chip costs have skyrocketed 80–90% during the first quarter of 2026 alone, based on data from Counterpoint Research.
The spike stems from constrained memory supply, as manufacturers prioritize shipments to AI data centers. Smartphone producers find themselves on the losing end of this allocation battle.
Memory components represent one of the largest cost factors in contemporary smartphones. Gartner analysts project industry-wide smartphone prices could increase 13% throughout 2026 as manufacturers respond to component costs.
IDC has issued a more severe forecast, predicting a 12.9% contraction in worldwide smartphone shipments this year driven by the component supply crisis.
Xiaomi maintained steady pricing for its flagship models, though industry analysts highlight the company’s heightened vulnerability compared to larger competitors. Apple and Samsung possess established premium customer bases capable of absorbing price increases. Xiaomi operates with less flexibility in this regard.
“This year will be even worse because Xiaomi does not have a very strong premium share which means that they cannot rely on the premium segment to offset low margins in other devices like Apple and Samsung can,” said Francisco Jeronimo, VP of data and analytics at IDC.
Xiaomi generates the majority of its smartphone volume through mid-range products — precisely the segment analysts identify as most vulnerable to price pressures.
Ben Wood, chief analyst at CCS Insight, indicated Xiaomi will probably need to implement price adjustments on its budget and mid-tier products eventually. The critical issue centers on how long they can postpone such moves while protecting profit margins.
Electric Vehicle Division Provides Critical Support
Xiaomi’s automotive segment has emerged as an increasingly vital revenue source. During its latest quarterly report — covering September 2025 — EV sales jumped nearly 200% compared to the prior year.
During that same period, smartphone revenue dropped 3% year-over-year. The electric vehicle business currently represents approximately one-quarter of total company revenue.
Elliptic Labs Broadens Xiaomi Integration
In related developments, Norwegian artificial intelligence firm Elliptic Labs disclosed its AI Virtual Smart Sensor Platform launched on five additional Xiaomi and Transsion products in February 2026.
The software eliminates the need for physical proximity sensors, reducing component expenses and enhancing power management. Elliptic Labs’ technology currently operates across more than 500 million devices globally.
Despite these commercial successes, Elliptic Labs stock (EIP) has declined 45.51% year-to-date and maintains a market capitalization of NOK 389.6 million.
Xiaomi executives signaled back in November 2025 that the smartphone sector would probably face price increases throughout 2026, a forecast now materializing across the market.
