Xiaomi's self-developed smartphone chip is here! Lei Jun announced the release in late May, a significant breakthrough in ten years of "chip-making."

Xiaomi's ten-year journey in chip development is about to bear fruit, with the self-developed SoC chip "Xuanjie O1" set to be released this month.

Following Apple, Samsung, and Huawei, Xiaomi has become the fourth smartphone brand in the world to have its own self-developed mobile SoC. This move not only marks another significant breakthrough for Chinese tech companies in the path of chip independence but will also become one of the four catalysts driving Xiaomi's stock price upward. Investors should closely monitor the chip release at the end of May and the subsequent performance of Xiaomi's stock price.

Self-Developed Chip Emerges, Xiaomi Officially Joins the "Chip-Making Club"

On the evening of May 15, Xiaomi Group founder, chairman, and CEO Lei Jun officially announced via social media:

"I want to share some news with everyone: Xiaomi's self-developed mobile SoC chip, named Xuanjie O1, will be released in late May. Thank you all for your support!"

This news marks Xiaomi's official entry into the elite club of global mobile self-developed SoC chips, becoming the fourth smartphone brand in the world to have its own self-developed mobile SoC after Apple, Samsung, and Huawei.

According to Shanghai Securities News, following the launch of its first self-developed chip, Surge S1, in 2017, this is Xiaomi's first release of a mobile main control chip in eight years, demonstrating Xiaomi's continued investment and achievements in the semiconductor field.

A Decade of Chip Development: From Surge S1 to Xuanjie O1

Xiaomi's journey in self-developed chips began in October 2014 when it established a wholly-owned subsidiary, Beijing Pinecone Electronics, officially starting its mobile chip development path. In February 2017, Xiaomi released its first self-developed SoC chip, Surge S1, which used a 28nm process and was equipped in the Xiaomi 5C phone, but the market response was limited. Surge S1 did not continue due to technical bottlenecks and supply chain issues.

Subsequently, there were reports of the failure of the Surge S2 tape-out, and progress on the core system-level chip slowed for a time. However, Xiaomi did not abandon chip development but adjusted its strategy, starting with dedicated chips: in 2021, it launched the self-developed imaging chip Surge C1 and the charging management chip Surge P1, and in 2022, it introduced the Surge G1 battery management chip, gradually accumulating experience through the release of smaller chips.

According to Shanghai Securities News, the research and development team for Xuanjie O1 consists of over 1,000 people, operating independently from Xiaomi's main body, led by former Qualcomm executive Qin Muyun, with high-level confidentiality and direct supervision from senior management. Previously, there were reports that Xiaomi had established a chip platform department under the organizational structure of the mobile product department, appointing Qin Muyun as the head.

SoC Chip: The "Brain" and "Nervous System" of Mobile Phones

SoC (System on Chip) chips are the core components that determine mobile phone performance. According to Securities Times, it is like a "miniature city," integrating multiple functional modules such as CPU (Central Processing Unit), GPU (Graphics Processing Unit), DSP (Digital Signal Processor), RAM (Random Access Memory), Modem, and navigation positioning modules, allowing mobile phones to achieve rich functionalities within a limited volumeWang Peng, a deputy researcher at the Beijing Academy of Social Sciences, stated to the Securities Times: "Self-developed chips can better meet the performance and unique technological advantages required by mobile phone manufacturers, enhancing the competitiveness of mobile phones. At the same time, it can also reduce mobile phone manufacturers' dependence on the supply chain, providing them with stronger supply chain control."

The Technology Company Behind "Xuanjie O1"

The name of the Xuanjie O1 chip comes from its parent company. According to Qichacha data, Beijing Xuanjie Technology Co., Ltd. was established on October 26, 2023, with a registered capital of 3 billion yuan, and the executive director is Zeng Xuezhong.

Zeng Xuezhong joined Xiaomi Corporation in 2020 and was responsible for the research and development and production of mobile phone products. He is currently the Senior Vice President and President of the International Business Department at Xiaomi Corporation, overseeing the Internet Business Department. He has extensive experience in the telecommunications and chip industries, having served as Senior Vice President and President of ZTE Corporation for the China region, Executive Vice President of ZTE Corporation, and CEO of ZTE's terminal division. He has also held positions as Global Executive Vice President of Tsinghua Unigroup Co., Ltd., President of Tsinghua Unigroup, and CEO of UNISOC. Additionally, he is the Vice Chairman of the China Integrated Circuit Design Industry Technology Innovation Strategic Alliance.

According to Qichacha data, since 2025, Beijing Xuanjie has been actively applying for public invention patents related to chips. Just on Tuesday, May 13, the company applied for 10 public invention patents, including "Chip Packaging Method, Chip Packaging Structure, and Electronic Device." Currently, the company has 115 public patents, covering categories such as telecommunications technology, basic electrical components, and basic electronic circuits, with 113 patents under review.

Catalysts for Xiaomi's Stock Price: Four Positive Factors Driving Growth

Deutsche Bank analyst Bin Wang stated in a recent research report that the recent pullback in Xiaomi's stock price provides a good buying opportunity for investors. The report believes that there are four key catalysts in the next two months that may drive a rebound in Xiaomi's stock price, one of which is the self-developed mobile phone chip. These four positive factors for the stock price are:

1. Q1 2025 Financial Report: Deutsche Bank expects Xiaomi's sales in Q1 2025 to grow by 9% year-on-year, reaching 75,869 units, with the gross margin of smart electric vehicles and new businesses increasing to 22% quarter-on-quarter. The total revenue for the first quarter is estimated to be approximately 109 billion yuan, with an adjusted net profit of 10 billion yuan (a year-on-year increase of 54% and a quarter-on-quarter increase of 20%).

2. Release of Self-Developed Mobile Phone Chip: According to DigiTimes, Xiaomi is expected to launch its self-developed smartphone chip set (codenamed XRING, confirmed as "Xuanjie O1") by the end of May.

3. Investor Day Event: Xiaomi plans to hold a "2025 Investor Day" meeting on June 3, followed by a visit to the smart electric vehicle factory in Beijing from June 4 to 5.

4. Launch of "YU7" SUV: Xiaomi's second model, the "YU7" electric SUV, is set to be released in June or July, with Deutsche Bank predicting monthly sales to reach approximately 30,000 units

The Chinese Semiconductor Industry Chain Further Moves Towards Self-Control

Industry experts believe that the release of the Xuanjie O1 is a phased achievement of the self-control of the Chinese semiconductor industry chain. If mass production is successful, it will encourage domestic smartphone manufacturers to reduce their dependence on suppliers like Qualcomm and may inspire more companies to join the chip research and development ranks.

People's Daily highly praised the significance of Xiaomi's self-developed chips this Wednesday, stating, "In the past year, Xiaomi has continuously brought breakthroughs and innovations in the fields of new energy vehicles and domestic chips. This proves that as long as we are determined and practical, there are no insurmountable mountains; as long as we strive to catch up, latecomers will always have opportunities."

People's Daily pointed out:

"Currently, the vitality of the private economy continues to be released, and more and more private enterprises are bravely shouldering responsibilities and pioneering new paths in technological and industrial innovation. Opening up unfamiliar fields will inevitably bring new problems and challenges, and exploring unknown boundaries will inevitably experience misunderstandings and doubts. Amidst the turmoil, the key is: to remain calm and focused, to forge ahead with determination, to face development issues with a developmental perspective, and to solve developmental problems with developmental methods.

In the current complex and changeable international environment, where core technology competition is becoming increasingly fierce, it is crucial for private entrepreneurs to maintain the spirit of 'only by striving can one win.'"

Xiaomi's 2024 financial report shows that its R&D investment continues to increase, with annual R&D expenditure reaching 24.1 billion yuan, a year-on-year increase of 25.9%, and the proportion of R&D personnel reaching 48.5%. Technological breakthroughs include the self-developed super motor V8s, Surge OS 2 system, and intelligent driving technology, with over 42,000 global authorized patents, including more than 1,000 automotive-related patents.

Market rumors suggest that the Xiaomi 15S Pro will debut with Xiaomi's self-developed SoC chip, equipped with UWB technology, enabling deep integration with Xiaomi vehicles (such as SU7/YU7). Subsequent Xiaomi models will gradually adopt the Xuanjie series chips, and may expand into automotive intelligent cockpits and IoT devices in the future.

As the "Xuanjie O1" is about to be unveiled, investors and the tech community will closely monitor the specific specifications and market performance of this highly anticipated chip product, which not only relates to Xiaomi's future technological roadmap and product competitiveness but will also further test the R&D strength of Chinese enterprises in the high-end chip field.

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