XRING triple-chip breakthroughs strengthen Xiaomi's on-device AI and vertical integration; Goldman Sachs maintains Buy and HK$39 target price

Overview

The report focuses on the XRING O3, O100, and D100 chips unveiled by Xiaomi on August 24, 2026, and argues that these products will unify the AI computing infrastructure of its “Human × Car × Home” ecosystem while accelerating Xiaomi's vertical integration from chips and operating systems to end products. Goldman Sachs maintains its Buy rating and 12-month target price of HK$39.

Core views

The first main theme is the flagship device chip XRING O3. It is the successor to XRING O1, which was launched in May 2025 and has shipped more than 1 million units cumulatively. O3 uses a 3nm process and integrates 24 billion transistors. Its AnTuTu score reached 5.22 million, compared with the report's cited ranges of 3.9 million to 4.0 million for Snapdragon 8 Elite Gen 5 and 3.5 million to 4.0 million for MediaTek Dimensity 9500. O3 uses a 10-core CPU with all large cores and consumes 25% less power than O1 in everyday tasks; its 16-core Mali-G2-Ultra-NX MC16 GPU delivers 85% higher performance and 64% lower power consumption. The custom LPDDR6-compatible NPU provides 3.13 TFLOPS of vector compute and 200 TOPS of tensor performance, with the latter being 6 times that of O1 and 3 times that of flagship SoCs. When combined with the MiMo large model, on-device AI prefill and decoding speeds increase by 40% and 45%, respectively, while power consumption declines by 25%. Based on this, Goldman Sachs believes that deep integration between XRING and HyperOS could create a more consistent user experience and pave the way for further premiumization of flagship smartphones, with a hardware-software synergy similar to the integration of Apple silicon and iOS. The second main theme is XRING O100, designed for high-bandwidth on-device large-model deployment. The chip uses a 6nm process and 3D wafer-level stacking, delivering 1.22TB/s of bandwidth, 16 times that of mainstream LPDDR5X and comparable to HBM bandwidth. It can reach 330 tokens per second when running Xiaomi's MiMo-3B model. Goldman Sachs believes that this type of AI acceleration can enable more responsive on-device inference in smartphones, robots, and electric vehicles, thereby improving both consumer experience and robotic execution performance. The third main theme is the intelligent driving chip XRING D100. The report describes it as China's first 3nm high-compute ADAS chip, featuring a 20-core high-performance CPU, a 16-core NPU, and up to 160GB of unified memory. It can locally run large models with up to 200 billion parameters and supports multi-chip fusion computing. Xiaomi also demonstrated a Xiaomi AI Cube desktop prototype equipped with O3, O100, and D100, on which it locally deployed models with 120 billion and 3 billion parameters. Goldman Sachs expects the self-developed ADAS chip to deliver greater cost savings for the smart electric vehicle business compared with the Nvidia DRIVE Thor used in Xiaomi's SU7, YU7, and SkyNomad series. Regarding product rollout, XRING O3 is expected to first appear in the Xiaomi 18 Fold, scheduled for release in September 2026, while O100 and D100 are expected to begin commercial deployment in 2027. The three chips cover general-purpose flagship SoCs, on-device AI acceleration, and intelligent driving compute, enabling Xiaomi to reuse a more unified computing infrastructure across its “Human × Car × Home” ecosystem rather than merely launching a standalone hardware product. The robotics demonstration further illustrates the direction of combining on-device AI with physical intelligence. Xiaomi's next-generation humanoid robot, demonstrated at the 2026 World Robot Conference, has 66 degrees of freedom, about half of which are concentrated in its two arms and dexterous hands. It is also equipped with Mi-Sense depth visual perception, a tactile system covering the entire palm and supporting millimeter-level precision grasping, and the Xiaomi-Robotics-1 vision-language-action foundation model. Goldman Sachs links these capabilities to the low-latency on-device inference supported by O100 and believes that it could improve robotic perception and motion performance. R&D investment provides the resource foundation for the vertical integration strategy described above. Xiaomi has committed RMB200 billion to R&D during 2026—2030 and plans to invest RMB50 billion in XRING R&D during 2025—2034. As of April 2025, before O1 was launched, cumulative XRING R&D investment stood at RMB13.5 billion and the team comprised approximately 2,500 people. A further RMB7.5 billion was invested over the subsequent 16 months, with the total team size increasing to approximately 3,000. However, Goldman Sachs expects Xiaomi not to replace external suppliers entirely, but rather to continue deep cooperation with chip partners while concentrating investment in self-developed chips. Near-term catalysts include the official launch of SkyNomad in early September 2026 and disclosure of confirmed order volumes at the end of the National Day Golden Week in early October; the Mijia brand's large-scale European launch at IFA 2026, paving the way for further overseas expansion; the launch of next-generation XRING chips and HyperOS; the launch of the Xiaomi 18 flagship smartphone in late September; and the release of the MiMo-V3 model and other AI applications. Goldman Sachs believes these events collectively constitute a new round of product and ecosystem catalysts. Over the long term, Goldman Sachs positions Xiaomi as the world's third-largest smartphone brand and a leading consumer AIoT and new energy vehicle platform, and believes that the multi-year ecosystem expansion driven by its “Human × Car × Home” strategy remains in its early stages. The report emphasizes that Xiaomi's robust balance sheet, ecosystem integration capabilities, economies of scale, and cost advantages from deep participation in the electric vehicle supply chain are expected to strengthen its competitiveness in the EV market and help it leverage connected consumer devices to build a large global consumer physical-intelligence ecosystem. Regarding valuation, Goldman Sachs maintains its Buy rating and 12-month target price of HK$39. The current price is HK$29.02, corresponding to the report's stated upside of 34.4%. The target price uses a sum-of-the-parts approach: Xiaomi's core business is valued at 16 times target next-12-month EV/NOPAT; Xiaomi Auto is valued using DCF, yielding an equity value of US$35 billion based on a WACC of 12% and a terminal growth rate of 3%; and a 10% holding-company discount is then applied.

Analysis framework

Goldman Sachs first compares the process nodes, computing power, bandwidth, power consumption, and on-device model performance of the three XRING chips, then separately infers their implications for smartphone premiumization, automotive costs, robotic capabilities, and the AIoT experience. It subsequently combines the commercial deployment timetable, R&D investment, and near-term product catalysts to formulate its strategic assessment of the company, before applying a sum-of-the-parts valuation based on a multiple for the core business and a DCF valuation for the automotive business, including a holding-company discount, to derive the target price.

Methodology notes

• Valuation methodologySOTP valuation

  Sum-of-the-parts valuation

  The report separately values Xiaomi's core business and automotive business, then applies a 10% holding-company discount to derive the group's overall 12-month target price.

• Valuation methodologyDCF discounted cash flow

  Xiaomi Auto DCF valuation

  The report discounts Xiaomi Auto's future cash flows using a 12% weighted average cost of capital and a 3% terminal growth rate, yielding a valuation of US$35 billion.

• Event trading and behavioral financeEvent-driven analysis

  Product and order catalyst tracking

  The report treats clearly defined milestones such as the SkyNomad launch and orders, Mijia's European launch, XRING and HyperOS, Xiaomi 18, and MiMo-V3 as near-term catalysts.

• Competitive and strategic frameworkValue chain analysis

  Chip-system-device vertical integration

  The report analyzes how hardware-software synergy can improve experience, reduce costs, and strengthen ecosystem competitiveness across the chain of self-developed chips, operating systems, and smartphone, automotive, robotics, and AIoT devices.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Xiaomi Corporation (1810.HK)

  The three XRING chips are the company's core vehicles for unifying AI computing infrastructure and accelerating vertical integration across smartphones, automobiles, robotics, and AIoT.

  Strengths

  The world's third-largest smartphone brand and a leading consumer AIoT and new energy vehicle platform, with a robust balance sheet, ecosystem integration capabilities, economies-of-scale cost advantages, and a foundation of connected consumer devices.

  Weaknesses

  Self-developed chips, brand premiumization, and the smart vehicle business still require sustained investment and commercial execution, while O100 and D100 will not begin commercial deployment until 2027.

  Comparison

  O3's AnTuTu score exceeds the ranges cited in the report for Snapdragon 8 Elite Gen 5 and MediaTek Dimensity 9500, while D100's cost rationale is compared with the Nvidia DRIVE Thor used in the SU7, YU7, and SkyNomad.

  Risks

  Intensifying global smartphone competition, margin pressure, weaker-than-expected premiumization or automotive execution, geopolitical and regulatory uncertainty, macroeconomic and demand weakness, and foreign-exchange fluctuations.

Key data

• Cumulative XRING O1 shipmentsMore than 1 million unitsCumulative shipments from its May 2025 launch through the reporting period
• XRING O3 AnTuTu score5.22 millionCompared with 3.9 million to 4.0 million for Snapdragon 8 Elite Gen 5 and 3.5 million to 4.0 million for MediaTek Dimensity 9500
• XRING O3 process and transistors3nm, 24 billion transistorsNext-generation flagship SoC
• XRING O3 CPU10 cores with all large cores, 25% lower power consumption in everyday tasksCompared with XRING O1
• XRING O3 GPU16 cores, 85% higher performance and 64% lower power consumptionCompared with XRING O1
• XRING O3 NPU3.13 TFLOPS of vector compute, 200 TOPS of tensor performanceTensor performance is 6 times that of XRING O1 and 3 times that of flagship SoCs
• O3 on-device AI improvements40% higher prefill speed, 45% higher decoding speed, and 25% lower power consumptionOn-device inference performance after integration with the MiMo large model
• XRING O100 bandwidth1.22TB/s16 times that of mainstream LPDDR5X and described by the report as comparable to HBM
• XRING O100 model speed330 token/sRunning the MiMo-3B model
• XRING D100 configuration20-core CPU, 16-core NPU, and up to 160GB of unified memoryCan locally run large models with up to 200 billion parameters and supports multi-chip fusion computing
• Humanoid robot degrees of freedom66Approximately half are concentrated in the two arms and dexterous hands
• Company R&D investment planRMB200 billion2026—2030
• XRING R&D investment planRMB50 billion2025—2034
• Existing XRING investment and teamCumulative RMB13.5 billion and approximately 2,500 people as of April 2025Before the launch of XRING O1
• Subsequent XRING investment and teamAn additional RMB7.5 billion over the past 16 months, with a total team of approximately 3,000 peopleReflects increased resource investment in self-developed chips
• 12-month target priceHK$39Unchanged; current price of HK$29.02, implying 34.4% upside
• Core business valuation multiple16 times next-12-month EV/NOPATXiaomi's core business component in the sum-of-the-parts valuation
• Xiaomi Auto valuationUS$35bnDCF assumes a WACC of 12% and a terminal growth rate of 3%
• Holding-company discount10%Applied to the sum-of-the-parts valuation

Impact & implications

The report believes that the three XRING chips enable Xiaomi to connect smartphones, automobiles, robots, and home devices through a unified computing architecture: O3 supports flagship smartphone premiumization, D100 could reduce smart vehicles' dependence on external ADAS chips and generate cost savings, while O100 enhances real-time AI inference across multiple categories of devices. Combined with long-term R&D investment and the “Human × Car × Home” ecosystem, Goldman Sachs expects vertical integration to strengthen Xiaomi's product experience, cost advantages, and competitiveness in the consumer physical-intelligence ecosystem.

Risks

• Competition in the global smartphone industry could intensify, and market-share gains may be weaker than expected.
• Gross-margin pressure in the smartphone or electric vehicle business may be greater than expected.
• Execution of Xiaomi's brand premiumization and electric vehicle business may fall short of expectations.
• Geopolitical risks and regulatory uncertainty may intensify.
• A weakening macroeconomic environment could weigh on smartphone and IoT demand.
• Foreign-exchange fluctuations could adversely affect the company's performance and valuation.

What to watch

• Monitor SkyNomad's official launch in early September 2026 and confirmed order volumes at the end of the National Day Golden Week in early October.
• Monitor the Mijia brand's large-scale European launch at IFA 2026 and subsequent progress in overseas expansion.
• Monitor the launch and synergistic performance of the next-generation XRING chips and HyperOS.
• Monitor the launch of the Xiaomi 18 flagship smartphone in late September 2026 and the progress of O3's September debut with the Xiaomi 18 Fold.
• Monitor the release of the MiMo-V3 model and other AI applications.
• Monitor the pace and actual applications of commercial deployment for XRING O100 and D100 beginning in 2027.