Xiaomi takes long-term path with $7B chip investment, avoids Apple's annual launch race

Xiaomi is building a powerful new smartphone chip, but won’t follow Apple’s yearly playbook. Vice President Xu Fei said the company is “planning ahead” for the next phase of its chip strategy, but made it clear that an annual launch cycle just doesn’t make sense for them right now.

The Beijing-based company released its first custom system-on-chip, the XRing 01, last year. That chip runs on a 3-nanometer process, making it one of the most advanced chips in the world. But despite the tech specs, Xiaomi isn’t pretending it’s in the same chip race as Apple, at least not yet.

Apple has been pumping out chips every year since 2010 under its A-series, with the latest A19 found inside the iPhone 17 models. Xu said Xiaomi doesn’t have the same luxury or margin for error. “We are a newcomer here,” she said. “We need to learn and we need to plan.”

Xiaomi links chip development to real-world performance

Xiaomi plans to ship 1 million XRing 01 units, but Xu said that’s far from the break-even point. She laid it out clearly: “We probably need to have ten years patience for the SoC to finally break even.”

For the numbers to make sense, Xiaomi would need to push 10 million units per chip release. That’s the minimum for the chip business to stop bleeding money. Until then, it’s all about getting the product right.

“We just need to make sure the experience is good enough, the performance is good enough,” Xu said. That means no rushing, no fluff. Just results. The company has already committed 50 billion yuan, roughly $7 billion—for chip development over the next ten years.

And they’re not doing it just for bragging rights. This is about building the backbone of an ecosystem, not a one-hit wonder.

Xiaomi’s chips are being designed to work hand-in-hand with HyperOS, its own Android-based operating system, and HyperAI, a package of artificial intelligence features developed in-house.

That combo is where the company sees real control: one chip powering one tightly integrated ecosystem, just like Apple and Google. Neil Shah, a partner at Counterpoint Research, told CNBC that Xiaomi is building vertical expertise, aiming to create a seamless experience across its tech products.

But don’t think Xiaomi is cutting out its old partners. Xu made it clear that Qualcomm and MediaTek are still part of the equation. “For Qualcomm, MediaTek, they are super, extremely good partners. We’ve been working them for 15 years, so we will continue this path,” she said.

Even the new Xiaomi 17, launched this week, runs on Qualcomm’s latest chip. So no, the company isn’t ditching American or Taiwanese silicon just yet.

Xu said they’ll continue using chips from both companies while also testing out their own. “We are going with two solutions at the same time,” she said. It’s not one or the other—it’s both. She added, “We made it very clear to our partners: don’t be too worried at all.”

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