Chinese smartphone maker Xiaomi on Monday unveiled a new version of its in-house Xring smartphone processor, betting that deeper control over key components will help strengthen its supply chain and reduce reliance on external chip suppliers.
The introduction of Xring O3 comes a year after Xiaomi launched its first proprietary smartphone processor, the Xring O1, marking the latest step in the world's third-largest smartphone vendor's push to join rivals such as Apple, Samsung Electronics and Huawei in developing its own chips.
TSMC will manufacture the new chip using its 3-nanometre production technology, two people familiar with the matter said.
One of the sources said the chip is expected to power Xiaomi's upcoming flagship folding phone, with a shipment target of 200,000 to 300,000 units.
The people declined to be identified because the plans are not public. Xiaomi and TSMC did not immediately respond to requests for comment on the chip's manufacturer, production technology or shipment targets.
Smartphone processors, or system-on-chips (SoC), integrate computing, graphics, AI processing and imaging functions into a single component.
Xiaomi's chip push reflects a broader industry trend as device makers seek to differentiate products and lessen dependence on suppliers such as Qualcomm and MediaTek amid intensifying competition in premium smartphones.
Xiaomi said during an earnings call last week that cumulative shipments of devices powered by the Xring O1, including smartphones, tablets and watches, had surpassed 1 million units since its launch.
Xiaomi has sold about 150,000 smartphones based on the Xring O1 chip since its May 2025 launch, according to the sources.
