Xiaomi’s Summer of Reckoning: A Custom Chip and a Cherry-Red SUV

The Chinese tech giant is sprinting in two directions at once—deepening its hardware independence while widening its automotive footprint—but the market has yet to buy the vision. Xiaomi’s stock languishes near a 52-week low of EUR 3.38, down roughly 25 percent since January and off nearly 39 percent over the past twelve months, even as the company prepares to launch both a flagship foldable smartphone powered by its own silicon and a premium electric crossover.

A Foldable Returns With Homegrown Brains

Internal code references have surfaced linking a device codenamed “Lhasa” to Xiaomi’s Xring O3 chipset, the successor to the Xring O1 that debuted in the 15S Pro last year. The upcoming foldable—which could be branded as the Xiaomi 17 Fold, Mix Fold 5, or Mix Fold 6—marks the company’s return to the horizontal foldable segment after skipping it entirely in 2025. A launch is expected around July, putting it in direct competition with Samsung’s next Galaxy Z Fold. Whether the device will reach global markets remains an open question.

The Xring O3 represents more than a product refresh. Xiaomi’s Xring O1 team earned the company’s highest internal award after it became the only mainland Chinese manufacturer to bring a 3-nm flagship processor to market. CEO Lei Jun has signalled that 2026 will see a sharper focus on proprietary chipsets, alongside exploratory work on a custom operating system and in-house large language models.

An EV Offensive in Cherry Red

While the foldable targets the premium smartphone tier, Xiaomi’s automotive division is charging ahead with its own high-end ambitions. At the Auto China 2026 show in Beijing, Lei Jun unveiled the YU7 GT, a sporty crossover expected to launch by the end of May with a price tag of up to 500,000 yuan (roughly EUR 64,000). The vehicle, finished in a new “Cherry Red” shade and featuring an aggressive front-end design, reinforces the company’s decision to steer clear of budget EVs for at least the next decade. Instead, Xiaomi has set its sights squarely on Porsche and Tesla.

Should investors sell immediately? Or is it worth buying Xiaomi?

The strategy is producing results on the ground. Last year, Xiaomi’s debut model, the SU7, outsold the Tesla Model 3 in China for the first time. In the first quarter of 2026, the company delivered more than 79,000 vehicles, and management is targeting roughly 550,000 units for the full year. To sustain that growth, Xiaomi is also preparing to enter the hybrid space with extended-range electric vehicle (EREV) models, having previously focused exclusively on battery-electric powertrains. Between four and six new models priced from 200,000 yuan are planned for this year alone.

Europe Beckons, but the Stock Stays Stuck

The next frontier is Europe. Xiaomi is laying the groundwork for a 2027 market entry, and a recent visit by Spain’s prime minister to the company’s Beijing headquarters suggests that Madrid is angling to host a production site. The political courtship underscores the high stakes of Xiaomi’s expansion as it jostles with increasingly aggressive rivals from both Asia and the West.

Yet none of this momentum has translated into share-price gains. The stock hit its 52-week trough of EUR 3.38 in mid-April, having shed more than half its value from the all-time high reached in spring 2025. It recently slipped below its 20-day moving average, a technical signal that analysts interpret as lingering investor scepticism about the brutally competitive EV landscape.

A Summer Test for the Premium Thesis

The Xring O3 foldable arriving around July will offer a tangible gauge of whether Xiaomi’s chip ambitions can resonate in the premium smartphone space. Combined with the YU7 GT’s debut and the broader EV ramp-up, the coming months will test whether operational wins can eventually shift the market’s mood—or whether the disconnect between Xiaomi’s technological offensive and its battered stock price will persist.