Xiaomi has started mass production of its first in-house mobile chip, the Xring O1, according to founder Lei Jun.

The chip will debut in the upcoming Xiaomi 15S Pro smartphone and Xiaomi Pad 7 Ultra.

Lei revealed the news via a post on Weibo, ahead of the official launch event scheduled for May 22, 2025.

Xiaomi has invested 13.5 billion yuan (US$1.87 billion) to develop the Xring O1 chip.

The company plans to spend at least 50 billion yuan (US$6.9 billion) on chip design over the next decade.

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🔗 Source: Reuters

🧠 Food for thought

1️⃣ Vertical integration follows Apple’s playbook amid fierce competition

Xiaomi’s $1.87 billion investment in the Xring O1 represents a strategic shift toward greater vertical integration, following a path similar to Apple’s successful silicon strategy.

The company has historically relied on Qualcomm chips for its flagship devices while focusing on competitive pricing, but this in-house development signals a fundamental change in approach 1.

This shift comes as the smartphone market has matured. Xiaomi grew from selling 18.7 million phones in 2013 to becoming the fifth-largest global smartphone vendor just three years after its founding 2.

The Xring O1’s competitive benchmarks, with multi-core scores around 9,000 that rival Qualcomm’s Snapdragon 8 Elite, demonstrate the technical viability of this strategy 3.

Designing proprietary chips enables tighter hardware-software integration and product differentiation in a market where component access has become increasingly commoditized and competitive advantages harder to maintain.

2️⃣ Strategic tech self-sufficiency amid geopolitical pressures

The $6.9 billion decade-long chip investment comes against a backdrop of escalating US-China tensions that have threatened Chinese companies’ access to advanced semiconductors.

This massive commitment represents more than just product improvement. It’s an insurance policy against supply chain disruptions, with CEO Lei Jun assembling a team of 2,500 developers to work on chip design 4.

The Xring O1 uses advanced 3nm manufacturing technology, positioning it as a cutting-edge component comparable to the processes used in Apple’s latest A18 Pro chips 1.

This follows a broader trend among Chinese tech companies seeking technological self-sufficiency, similar to Huawei’s accelerated development of its Kirin chips after facing US restrictions 5.

By developing core technology in-house, Xiaomi is reducing its vulnerability to external supply chain risks while simultaneously creating long-term competitive advantages through proprietary chip architecture.

3️⃣ Evolution from value-focused assembler to integrated tech innovator

Xiaomi’s chip initiative marks a significant evolution from its founding strategy, which prioritized high price-performance ratios by using off-the-shelf components while focusing on software customization.

The company built its initial success on the MIUI Android skin (launched August 2010), followed by its first smartphone in August 2011, creating a business model that emphasized value through efficient distribution rather than component innovation 2.

Xiaomi gained prominence by selling products at near-cost to drive volume, with its founder Lei Jun explicitly stating the company’s mission was to upgrade China’s manufacturing sector using “internet thinking” 6.

The substantial R&D investment in custom silicon—contrasting with the company’s early $4.5 million founding capital—demonstrates how Xiaomi has transformed from a lean startup to a vertically integrated technology company with significant innovation capabilities 6.

This strategic shift mirrors the company’s expansion beyond smartphones into diverse product categories, including smart home devices and electric vehicles (announced in 2021 with a $10 billion investment), establishing a comprehensive technology ecosystem 2.

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