Xiaomi, Oppo, and Vivo Are Quietly Slashing Production Targets

According to a fresh report from Nikkei Asia, Chinese tech giants Xiaomi, Oppo, and Vivo have dropped their 2026 smartphone shipment targets by as much as 30% amid rising memory chip costs driven by the AI server boom.

Xiaomi, currently holding the crown as the third largest smartphone brand globally behind Samsung and Apple, had already issued a conservative 2026 forecast of 135 million units. That initial figure was a noticeable step down from the 170 million handsets the company successfully moved in 2025. Now, things have taken a sharp turn for the worse.

The company has slashed that forecast by an additional 30%, reducing its production target to a mere 95 million units for the year. The firm even took the extra step of warning its component suppliers that this number could sink deeper if market conditions fail to turn around.

Oppo and Vivo are facing identical pressures, dragging their respective 2026 shipment goals down below 90 million units each. Even Honor, which enjoyed a stellar 2025 with a record breaking 71 million phones shipped, has officially notified its supply network that it cannot maintain that growth trajectory through the rest of this year.

The root cause behind this industry wide scaleback is entirely structural. Smartphone manufacturers are finding themselves in a losing battle against hyper wealthy cloud service providers for the exact same silicon. Specifically, low power DRAM memory chips, which historically found a home inside mobile devices, are being redirected to feed data centres.

This crisis goes beyond memory. Nearly every piece of basic hardware required to assemble a functional phone is facing surging costs or tight allocation. Everything from system processors and printed circuit boards to simple glass cloth is getting pricier. Even packaging capacity at chip factories has become incredibly difficult to secure.

Major chip designers like MediaTek and Qualcomm are shifting their engineering and business focus toward the incredibly lucrative data centre sector to maximize returns. MediaTek has already signalled to its clients that it intends to raise prices to offset rising foundry costs.