Xiaomi Doubles Down on Chips and Cars in $42 Billion Bet on Future Tech

AsianFin — On its 15th anniversary, Xiaomi is making it clear: it's no longer just a smartphone company. The Beijing-based tech giant is aggressively expanding into chips and electric vehicles with plans to invest 200 billion yuan ($27.6 billion) in core technology R&D between 2026 and 2030 — nearly double its spending over the past five years.

Chairman and CEO Lei Jun described the strategy as "declaring war" on two trillion-dollar industries: semiconductors and automobiles. "This is the path we must take if we want to become a truly great technology company," Lei said at a company event this week.

Xiaomi unveiled its first flagship 3nm mobile processor, the XRing O1, marking a bold step into the highly competitive world of advanced semiconductors. Built with 19 billion transistors — on par with Apple's A18 Pro — the chip powers Xiaomi's new 15S Pro smartphone and delivers competitive performance across the board.

In multi-core tests, the XRing O1 actually outpaced Apple's A18 Pro with a score above 9,500, while its GPU beat Apple in graphics benchmarks by up to 20%, all while consuming 35% less power. Xiaomi attributes the efficiency to dynamic GPU power scaling that adapts to real-time workloads.

Xiaomi also launched the XRing T1, a 4G chip for smartwatches that integrates the company's first self-developed 4G baseband. The chip powers the Xiaomi Watch S4, offering eSIM support and a 66% reduction in standby power usage — enabling 9-day battery life.

Lei Jun revealed that development of the XRing O1 took over four years and 13.5 billion yuan ($1.9 billion) in investment. Over the next decade, Xiaomi is committing at least 50 billion yuan ($6.9 billion) to chip development. "It's a summit we must climb, a tough battle we cannot avoid," Lei said. "We're prepared to fight for at least ten years."

On the heels of the successful Xiaomi SU7, which has already surpassed 258,000 cumulative deliveries, the company also revealed the Xiaomi YU7, a luxury high-performance SUV slated to launch in July.

The YU7 will come in three variants, including the Max Edition which hits 0-100 km/h in just 3.23 seconds, boasts a 760 km range, and features Xiaomi's fastest 5.2C supercharging. All models come standard with the NVIDIA Thor computing platform, LiDAR, and a full suite of sensors, underlining Xiaomi's ambitions in autonomous driving.

The Thor chip — among the most powerful auto AI processors on the market — offers 700 TOPS of computing power and is built for the age of large AI models, giving Xiaomi vehicles a high-tech edge in the increasingly crowded EV race.

While pricing won't be revealed until July, Lei dismissed speculation that the YU7 could be priced as low as 199,000 yuan ($27,500). "That's not possible," he said. "With these specifications, it will cost more than 300,000 yuan."

Founded in 2010, Xiaomi made its name with affordable smartphones, but has spent the past decade building out a broader tech ecosystem. The company's expanding portfolio now includes smart devices, IoT hardware, and increasingly, deep-tech platforms that integrate software, hardware, and AI.

"Xiaomi is certainly not strong enough yet; there are still many imperfections," Lei acknowledged. "But over the next five years, we will strive for solid growth and deliver even better results."

As the company doubles down on high-stakes bets in semiconductors and smart mobility, its transformation into a fully integrated technology powerhouse is just beginning.