Xiaomi unveils new in-house chip to reduce reliance on Qualcomm, MediaTek -

Xiaomi Corp has unveiled a new mobile processor for its flagship smartphones, strengthening its push into in-house chip development and increasing competition for long-time suppliers Qualcomm and MediaTek.

The Xring O3 system-on-chip features improved power efficiency, image processing and artificial intelligence (AI) capabilities, Xiaomi said in a post on Chinese social media platform Weibo on Aug 24.

According to Xiaomi founder Lei Jun, the chip is built using a 3-nanometre manufacturing process. Taiwan Semiconductor Manufacturing Co (TSMC) is producing the processor, Reuters reported. The technology places Xiaomi closer to Apple’s latest chip designs and ahead of Huawei Technologies’ domestically developed processors in terms of manufacturing process.

The Xring O3 remains on the 3nm process even as leading chipmakers move towards 2nm technology, suggesting Xiaomi is focusing on chip architecture and features to improve performance. The processor includes redesigned computing capabilities, faster memory and enhanced on-device AI functions aimed at differentiating the company’s premium smartphones.

Xiaomi has spent years developing its own semiconductor technology as it seeks to reduce its dependence on foreign suppliers. Qualcomm and Taiwan-based MediaTek have traditionally supplied the company with processors for its smartphones.

An in-house chip could give Xiaomi greater control over product development, strengthen its negotiating position with suppliers and allow it to optimise research and development across a wider range of devices. However, limited production volumes mean the company is expected to continue relying heavily on Qualcomm and MediaTek.

Huawei has taken a similar approach, using its own Kirin processors in premium smartphones after US restrictions cut the company off from several major global suppliers, including Qualcomm. Xiaomi, however, is not subject to the same restrictions and continues to work with international chip manufacturers.

The move comes as Xiaomi faces weaker demand in both its smartphone and electric vehicle businesses. Counterpoint Research said Xiaomi recorded the largest shipment decline among major smartphone makers in the June quarter.

The company is also facing investor concerns that aggressive pricing of its latest sport utility vehicles could put further pressure on profit margins. – TS/ERMD

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