Xiaomi is changing its approach to smartphones. The company has sharply reduced the number of new models it launches each year. This shift marks a major break from its earlier strategy, which focused on flooding the market with a wide range of devices under multiple sub-brands. Xiaomi now aims to streamline its product lineup and focus more on software longevity, global consistency, and ecosystem integration.
Fewer phones, deeper integration
The decision comes even as the global smartphone market shows signs of recovery. According to Xiaomi’s Q2 2025 report, its smartphone revenue declined 2% YoY, despite overall market growth. In contrast, the company’s AIoT segment posted a 44.7% increase, reaching 38.7 billion yuan (about $5.4 billion). Its electric vehicle business generated over 20 billion yuan ($2.8 billion) in quarterly revenue, driven by strong demand for the SU7 and YU7. These figures suggest that smartphones are no longer Xiaomi’s primary engine of growth.
Xiaomi founder and CEO Lei Jun outlined the Human-Car-Home strategy as a key part of the company’s vision for the next decade. This ecosystem approach positions the smartphone as a central node connecting electric vehicles, smart home devices, and AI-powered platforms. In this context, product value depends less on specs or pricing and more on software experience and ecosystem performance.
To support this shift, Xiaomi has extended software support for major models. The Xiaomi 15 and Redmi Note 14 series now receive four OS upgrades and six years of security patches. This matches the update policies of brands like Samsung and Apple. However, supporting extended updates across dozens of regional variants has become increasingly difficult. The transition from MIUI to HyperOS requires Xiaomi to reduce product fragmentation and standardize global platforms.
Xiaomi’s experience in India played a key role in this shift. The company’s shipments in India dropped 42% YoY in early 2025, causing it to fall from first to sixth place in market share. Product overlap between Redmi, Poco, and Xiaomi lines led to confusion, while fragmented software builds across regions created delays and inconsistencies.
Xiaomi has responded by assigning each sub-brand a clearer role. Redmi targets the mass market, Xiaomi covers the mid-to-premium segments, Poco focuses on performance, and Civi caters to design-conscious users. HyperOS now serves as a global foundation to reduce regional variations and simplify maintenance.
The company is also reducing efforts in niche categories. It has been confirmed that there will be no Mix Fold 5 this year, while the Civi 5 Pro remains exclusive to China. Foldables require significant R&D investment and still represent a small portion of the market. Xiaomi prefers to allocate resources to areas like phone-to-car integration and smart cockpit systems, where it sees greater strategic value.
Xiaomi’s new direction rests on four key pillars: extended software lifecycles, a unified global software platform, a focus on durable hardware, and deeper ecosystem integration. This approach reduces the total number of phones launched each year, but improves quality, consistency, and user engagement.
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(Via)
