Xiaomi president Lu Weibing has reportedly taken to microblogging site Weibo to address the issue of rising memory chip prices, blaming them for driving up the production costs of the electronic company's headsets.

The comments follow the launch of its latest flagship smartphone series, Redmi K90, which disappointed the market mainly due to its higher-than-expected price, Reuters reported on Friday.

“Cost pressure has transferred to the pricing of our new products,” president Lu Weibing wrote. “Rising costs of memory chips are far beyond expectations and could intensify.”

Launched on the market on Thursday, the new entry-level Redmi K90, which is equipped with 12 GB of memory and 256 GB of storage, is priced from 2,599 yuan ($364).

The 2024 predecessor model, the K80 series, was priced at 2,499 yuan (around $350).

To alleviate consumers' disappointment at the price gap between the different configurations, the company's president said that Xiaomi will lower the price of the most popular K-90 model.

The model, which is currently on the market at a price of 3,000 yuan, will be reduced to 2,899 yuan for the first month of sales.

Demand for AI chips is putting pressure on global semiconductor supply chains, causing reduced availability and higher prices for conventional chips used in consumer electronics and servers.

Although this is leading to a significant increase in the cost of phones and computers, companies such as Samsung Electronics and SK Hynix continue to report high profits, being leading manufacturers of NAND and DRAM, two key types of memory used in electronic devices used for long-term storage and faster data access.

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