TECNO and Infinix phones got more expensive on purpose

Transsion Holdings makes TECNO, Infinix and itel. Between them, those three brands shipped 47% of all the smartphones that entered Africa in the first quarter of this year, according to Omdia. Almost one in every two new smartphones on the continent is a Transsion phone.

On the evening of Sunday 19 July, Transsion filed a document with the Shanghai Stock Exchange telling shareholders that its profit for the first half of 2026 will be far higher than last year. The filing explains why in plain language. The company put its prices up.

What the filing says

Transsion is listed on the Shanghai Stock Exchange under the code 688036. Chinese listing rules let a company issue an early estimate of its results before the audited accounts are ready. That is what this is: a voluntary profit forecast, calculated by Transsion’s own finance department, with the full half-year report still to come. The figures can move slightly when the auditors are done.

For the six months to June 2026, Transsion expects:

• Revenue of about RMB 35.657 billion, roughly KES 683 billion, up 22.63%
• Net profit attributable to shareholders of about RMB 1.756 billion, roughly KES 33.6 billion, up 44.82%
• Net profit stripped of one-off items of about RMB 1.532 billion, roughly KES 29.3 billion, up 70.71%

Those conversions use the rate of about KES 19.15 to the yuan.

The third number on the list matters most. Stripping out one-off gains and losses leaves what the business earned from its core operations, and that figure grew fastest of the three. In the same six months of 2025, Transsion earned RMB 897 million on that basis. This year it expects RMB 1.532 billion.

Here is the part you should understand: Transsion sold fewer smartphones in the first half of 2026 than in the first half of 2025. Its own filing says so. Nonetheless, revenue grew because, in the company’s own words, the average selling price of its smartphones rose by a lot.

Why prices went up

The cause is memory. Every phone needs RAM to run apps and storage to hold your files. Both are made from the same chips that artificial intelligence data centres are buying in enormous quantities, and chipmakers have shifted production towards the expensive server memory those data centres want. That leaves less of the ordinary memory that cheap phones need, and the price has climbed hard. We explained the mechanics of that squeeze in December and followed the way brands were hiding the cost in March.

UBS expects DDR memory contract prices to rise another 32% in the third quarter of 2026, and NAND flash 30%, and thinks memory stays short until at least the middle of 2028.

Transsion is more exposed to this than almost anyone, because its phones are cheap and memory is a bigger slice of what each one costs to build. Omdia calculated that memory made up nearly 60% of the bill of materials for a smartphone retailing under USD 400 in the first quarter of 2026, roughly double its share two quarters earlier. In a report published on 7 July, Omdia analyst Zaker Li said low-end products are already becoming unprofitable and face weakening demand as retail prices rise. That report named Transsion among the brands pushing increases through to protect thin margins.

The scale of the problem is visible in Transsion’s own average price. In the first half of 2025 its typical smartphone sold for RMB 547.5, comfortably under USD 80, or somewhere around KES 10,000 at 2025 exchange rates. That is a phone sitting inside the price bracket the company now says it wants to shrink.

Transsion stopped absorbing the cost. The company told investors and analysts at its 2025 results briefing on 27 March this year that it had been raising prices since the second half of 2025, and that it would change what it sells. Its management put it this way, as reported by China’s National Business Daily: the share of sales below USD 100 will fall, the share between USD 100 and USD 200 will rise, and products above USD 200 will grow considerably.

Transsion also told that briefing what it expects the cost to be. Price increases dampen demand, management said, and the effect is clearest at the low and mid range, where some buyers will delay a purchase or hold their current phone longer.

Why the margin gain is temporary

Transsion’s gross margin improved this half for a reason that will not repeat. In the first quarter of 2026 the company bought memory in bulk to lock in prices before they rose further. Its inventory jumped from RMB 8.903 billion at the end of 2025 to RMB 14.220 billion at the end of March, an increase of about 60% in three months. Paying for all that stock pushed first-quarter operating cash flow to negative RMB 4.094 billion.

That stockpile is why the sums worked. Transsion has been charging new, higher prices while still building phones from memory it bought cheaply. Once the cheap stock runs out and the expensive batches enter production, the cost side catches up.

What this looks like from Nairobi

The filing doesn’t go into detail about Kenya. What we do have is the shipment data. Omdia counted Kenyan smartphone shipments down 16% year on year in the first quarter of 2026, and attributed it to rising retail prices pushing people to keep their phones for longer.

Two quarters earlier, in the third quarter of 2025, Kenya grew 17%. Omdia credited that growth to device financing, as retailers and operators expanded instalment plans and buyers picked up refreshed entry-level phones.

Which makes what Transsion said in March worth pausing and reading twice. Asked how it would keep selling to buyers who cannot absorb higher prices, management pointed to instalments. Some customers, the company said, do not focus on the total price but on the monthly repayment, so if the monthly figure holds steady and only the number of months increases, the increase feels smaller. Kenya has M-KOPA and other device financing companies like Watu. There’s also a serious growing pay-as-you-go retail trade. The same mechanism that carried Kenyan growth in 2025 is now the one being promised to help with absorbing price rises in 2026.

Across Africa, phones under USD 200 were still 75% of shipments in the first quarter. Omdia expects the continent’s smartphone market to shrink 28% across 2026, with the USD 80 to USD 150 band hit hardest. That band is Transsion’s home ground. You can see this play out really well when you read our Best Under 10k and 20k lists.

Meanwhile, competitors are moving in to fill the gap. HONOR grew its African shipments 101% year on year in the first quarter, the fastest of any major brand. Xiaomi fell 28% over the same period. We covered that reshuffle in May.

What to watch

Transsion has applied to list in Hong Kong alongside its Shanghai listing, filing again in June after an earlier prospectus lapsed. A strong half-year helps that case.

If you’re following this story, the number to watch is the second-half gross margin. Transsion’s own management expects memory price rises to slow in the third and fourth quarters, and UBS agrees that the rate of increase is easing. But slowing is not falling, and the cheap inventory that carried this half will come to an end. If gross margin holds when the expensive memory reaches the production line, the company has genuinely repriced its range. If it does not, this half was a stockpile working through the accounts.

For anyone buying a phone in Kenya this year, just know this when you see a very expensive TECNO, Infinix or itel device, Transsion has told its investors, in writing, that it is selling fewer smartphones at higher prices on purpose, and that it wants a smaller share of its sales to come from the cheapest bracket.

If you go the financing way to get a new device, make sure you compare the total repayment on any financing offer against the cash price. That’s because a longer repayment plan is how a price rise gets made to feel like no price rise. Also, check the RAM and storage on the exact variant in front of you, because some brands are holding the price and cutting the specification instead. You will notice lots of 4GB RAM devices – even from Samsung.