Xiaomi has unveiled its Xring O3 smartphone processor as it expands its push toward in-house chip development. According to people familiar with the plans, Taiwan Semiconductor Manufacturing Company (TSMC) is expected to manufacture the chip using a 3-nanometre process. The Xring O3 could power Xiaomi’s upcoming flagship foldable phone, with shipments reportedly targeted at 200,000–300,000 units. The development follows Xiaomi’s Xring O1, which has surpassed one million device shipments across smartphones, tablets and watches, although its role remains relatively limited within Xiaomi’s broader hardware portfolio.
Xiaomi Xring O3 Chip Launch: TSMC 3nm Deal and New Foldable Phone Push Revealed
Xiaomi has unveiled its new in-house smartphone chip, the Xring O3, which is said by sources to be made by TSMC using 3-nanometer technology for an upcoming foldable flagship.
Xiaomi Xring O3 is the latest in the Chinese smartphone maker’s push to develop its own chips and reduce reliance on outside suppliers such as Qualcomm and MediaTek.
About a year after launching its first proprietary smartphone processor, the Xring O1, Xiaomi released the Xring O3 on Monday, August 24, Reuters said.
Two people familiar with the matter said Taiwan Semiconductor Manufacturing Company, or TSMC, will manufacture the Xring O3 with its 3-nanometre production technology.
They asked not to be identified because the plans for the plant have not been made public. Xiaomi and TSMC did not immediately respond to requests for comment.
One source said the Xring O3 is expected to power Xiaomi’s upcoming flagship folding phone, with shipments targeted at 200,000-300,000 units.
Xiaomi’s Xring O3 strengthens its in-house chip ambitions
Smartphone processors, or systems-on-chip (SoC), integrate computing, graphics, artificial intelligence processing and imaging into one component.
Greater control over processor development would allow Xiaomi to tailor hardware more closely to its products and strengthen its negotiating hand with outside semiconductor suppliers.
The move puts Xiaomi on a par with Apple, Samsung Electronics and Huawei, all of which have developed their own processors as competition heats up in the premium segment of the smartphone market.
Xiaomi restarted work on large in-house chips in 2021 and said it plans to invest at least 50 billion yuan ($7 billion) over a decade.
The company said on an earnings call last week that the total number of devices shipped with the Xring O1 had passed one million units.
The shipments include smartphones, tablets and watches. Sources separately estimated that about 150,000 Xring O1 smartphones have been sold since its May 2025 launch.
The numbers suggest that Xiaomi’s own silicon still plays a relatively small role in its overall smartphone business as the company continues to build out its semiconductor capabilities.
The development is a highlight of how Chinese consumer-electronics companies are increasingly seeking more control over critical technologies, while navigating supply-chain and component-cost pressures, for Sprouts News.
Foldable phones raise competition with Huawei
Xiaomi’s reported plan to use the Xring O3 in a flagship foldable puts the chip directly in a fast-growing premium segment dominated in China by established competitors.
Research firm Smart Analytics Global said Huawei sold 1.6 million foldable phones in China in the second quarter, accounting for 68% of the market.
Honor came next with 13.7%, followed by Oppo with 8.5%, the same research data cited by Reuters showed.
Xiaomi’s entry into the segment could thus spur more competition with Huawei, while giving the company another chance to showcase the capabilities of its in-house designed semiconductor technology.
The strategy comes as smartphone makers face pressure from rising memory and component costs that are pushing up prices and sapping consumer demand.
According to Visible Alpha data from S&P Global, the Chinese tech group sold 65 million smartphones in the first half of 2026 at an average price of 1,329 yuan.
That compares to a forecast of 84 million handsets at an average price of 1,141 yuan in the first half of 2025 and 83 million at 1,123 yuan in 2024.
The research firm International Data Corporation expects global shipments of smartphones to decline by 14% in 2026, which will put pressure on manufacturers to differentiate higher-priced products.
Also Read: Fahim Sayed, Naim Sayyed Arrested in ₹30,000-Crore Cyber Fraud Probe.
Xring O100 and D100 expand Xiaomi’s chip programme
Sources say Xiaomi is also contracting TSMC for two more Xring chips, as the company’s semiconductor ambitions extend beyond phone chips.
The Xring O100 is a 6nm neural processing unit that allegedly powers Xiaomi’s MiMo large language model on consumer devices.
The Xring D100 is a 3nm processor for autonomous driving applications, and may help strengthen the technological foundations of Xiaomi’s expanding electric vehicle business.
Xiaomi has already poured more than 20 billion yuan, about $3 billion, into Xring chip development, a source said.
The company’s semiconductor design workforce has grown to more than 3,000 people, up from about 2,500 last year.
In contrast, Xiaomi said that the Xring O3 has already entered mass production and the Xring O100 and Xring D100 are ready to go.
The company said the O100 and D100 are slated for deployment next year, extending Xiaomi's proprietary silicon ambitions beyond smartphones.
Xiaomi’s chips intersect with its growing EV business
Xiaomi’s semiconductor push also ties into its rapidly expanding electric vehicle business, where self-driving technology is an increasingly important battleground.
The company’s electric vehicle business had sales of 23.9 billion yuan in the second quarter and delivered 104,199 vehicles in the period.
Developing dedicated chips for cars could eventually give Xiaomi more control over computing infrastructure, artificial intelligence processing and autonomous-driving capabilities throughout its automotive ecosystem.
The bigger strategy is part of a trend by big device makers to design more components in-house, particularly where silicon can differentiate products and link hardware to proprietary software.
The immediate test for Xiaomi will be whether the Xring O3 can break out of limited flagship volumes and carve a bigger role across its device portfolio as we advance.
Production capacity, costs of components, consumer demand, and continued access to cutting-edge semiconductor manufacturing technology through TSMC will also factor into the company’s progress.
At the moment, the Xring O3 is another big leap in Xiaomi’s attempt to create a wider tech ecosystem of smartphones, AI, and electric vehicles.
