Xiaomi is increasing its push into proprietary silicon with a high-end processor anticipated to energy its subsequent flagship foldable.
The Chinese smartphone maker unveiled the Xring O3 on Monday, roughly a 12 months after introducing the Xring O1, its first flagship processor below the Xring program. The new chip is a part of Xiaomi’s broader effort to realize extra management over key parts and compete extra straight with Apple, Samsung Electronics and Huawei.
Two individuals acquainted with the matter advised Reuters that Taiwan Semiconductor Manufacturing Co. (TSMC) is anticipated to fabricate the O3 utilizing its 3-nanometer course of. One supply mentioned the O3 is anticipated to energy Xiaomi’s upcoming flagship foldable cellphone, with shipments focused at between 200,000 and 300,000 items.
That would make the O3 a comparatively small-volume product for Xiaomi. The firm mentioned final week that merchandise utilizing chips from its Xring lineup had handed 1 million cumulative shipments throughout smartphones, tablets, and watches. Sources advised Reuters that solely about 150,000 of these merchandise had been smartphones.
Xiaomi restarted growth of enormous in-house chips in 2021 and has pledged to take a position no less than 50 billion yuan ($7 billion) over a decade. It has already invested greater than 20 billion yuan in Xring growth, whereas its semiconductor design workforce has grown to greater than 3,000 individuals, in response to Reuters.
The technique might give Xiaomi larger management over how its {hardware} and software program work collectively whereas strengthening its place when negotiating with outdoors chip suppliers.
The O3 can also be arriving as smartphone makers face larger reminiscence and element prices. Xiaomi bought 65 million smartphones within the first half of 2026, down from 84 million in the identical interval final 12 months, whereas its common promoting worth elevated, in response to Visible Alpha knowledge cited by Reuters. IDC expects world smartphone shipments to fall 14% this 12 months.
That makes the economics of creating customized chips extra difficult. Building a processor internally can provide extra management over options, however modern manufacturing stays costly, particularly when preliminary volumes are measured in tons of of hundreds reasonably than tens of millions.
Foldables give Xiaomi a testing floor
Putting the O3 in a premium foldable may very well be a calculated transfer. Foldables usually command larger costs, giving Xiaomi extra room to soak up the prices and dangers of a brand new processor whereas testing its silicon in a flagship product.
The transfer additionally places Xiaomi deeper into competitors with Huawei. Huawei shipped 1.6 million foldables in China within the second quarter and held a 68% share of the market, in response to Smart Analytics Global knowledge cited by Reuters. Honor and Oppo adopted with 13.7% and eight.5%, respectively.
The extra necessary take a look at for Xiaomi, nevertheless, might come after the primary O3-powered cellphone. A couple of hundred thousand items would show that Xiaomi can design and manufacture a sophisticated processor, however broader adoption would present whether or not its chip program can change into a significant different to exterior suppliers.
Xring expands past smartphones
Xiaomi will not be stopping with the O3. Reuters reported that TSMC can also be anticipated to fabricate two different Xring chips: the 6nm O100 neural processing unit for Xiaomi’s MiMo massive language mannequin on shopper gadgets and the 3nm D100 for autonomous driving.
Xiaomi says the O3 has entered mass manufacturing, whereas the O100 and D100 have accomplished growth and are scheduled for deployment subsequent 12 months. Their rollout will present whether or not Xring can develop from a restricted flagship experiment right into a broader silicon platform spanning Xiaomi’s telephones, AI gadgets, and automobiles.
Read extra: Learn why AI chip bottlenecks stay a significant impediment for firms creating superior gadgets and infrastructure.
