Xiaomi Corporation has officially stepped into the artificial intelligence (AI) arena with the unveiling of MiMo, its first-ever open-source reasoning AI model, joining a rapidly escalating race among Chinese tech giants to dominate this strategic domain.

The launch was announced through Xiaomi’s official WeChat post, with internal benchmarks suggesting MiMo outperformed OpenAI’s o1-mini and Alibaba’s Qwen, although these results are yet to be independently verified by third-party sources like Bloomberg.

What is MiMo?

MiMo (short for Mi Model) is designed to replicate human-style reasoning, much like DeepSeek’s R1, which recently shook the Chinese tech scene with its affordable yet powerful capabilities. By positioning MiMo as a reasoning-first AI, Xiaomi has made it clear that it’s not just releasing a chatbot — it is working towards Artificial General Intelligence (AGI), which is widely regarded as the future of AI.

Xiaomi stated:

“While 2025 may seem like a late stage to take up the dream of large models, we believe AGI is a long-term endeavour.”

This declaration marks Xiaomi’s official entry into the competitive AI ecosystem, following years of hints and early-stage R&D investments.

Why Xiaomi’s Move is Strategic

This move is strategically significant for Xiaomi, traditionally known for budget smartphones, smart appliances, and more recently, electric vehicles (EVs). With global tech leaders like OpenAI, Google, Meta, and Baidu developing foundation models, Xiaomi’s MiMo represents China’s intensifying ambition to create homegrown alternatives that are less reliant on foreign innovation.

The Chinese government’s strong backing of the AI sector was evident this week when President Xi Jinping visited an AI incubator, further energising local tech companies and boosting AI stocks — including Xiaomi, which rose over 5% on the Hong Kong Stock Exchange after the announcement.

AI as Xiaomi’s Second Big Leap After EVs

Xiaomi’s AI push follows its massive ₹82,000 crore ($10 billion) entry into the electric vehicle sector, where it launched its first EV models under the “YU” brand. Founder Lei Jun described this as his final entrepreneurial journey, signalling just how crucial EVs and now AI are to the company's long-term strategy.

However, Xiaomi’s EV ambitions hit a speed bump earlier this year when a fatal accident involving its electric SUV caused delays in the rollout of the flagship YU7 vehicle. The company’s shares dropped over 15% in March 2025 following this setback.

Despite media reports, Xiaomi denied any change in the launch timeline of the YU7, stating that the release remains on track for June or July 2025.

The Benchmark Claims: MiMo vs OpenAI and Alibaba

Xiaomi’s benchmark comparison chart posted on WeChat claims that MiMo outperformed OpenAI’s o1-mini and Alibaba’s Qwen in certain tasks — though no detailed performance metrics were disclosed publicly. These models are lighter versions of their flagship counterparts and meant for cost-efficient and scalable applications.

By showcasing MiMo’s performance edge, Xiaomi aims to attract:

• Developers in China’s growing open-source ecosystem,

• Investors looking for alternatives to US-based AI firms,

• Enterprise clients seeking local AI deployment partners.

A Growing Trend: China’s Open-Source AI Movement

Xiaomi’s launch comes just a day after Alibaba released the latest update of its Qwen model, highlighting the fast-paced nature of AI development in China. The race truly intensified after DeepSeek’s R1 caught the industry’s attention by offering powerful reasoning capabilities at lower costs.

This open-source approach is becoming a trend in China, offering:

• Transparency in model training and usage,

• Faster adoption through community contributions,

• Regulatory compliance, as the government pushes for locally developed and controlled AI models.

Policy Support Driving China’s AI Ecosystem

The People’s Republic of China has strongly endorsed AI as a pillar of future economic growth. With Xi Jinping’s high-profile visits to tech innovation zones and state media coverage amplifying national efforts, companies like Xiaomi are being encouraged to build capabilities that can rival the US.

Government support includes:

• Funding for AI incubators and accelerators

• Policy incentives for AI startups and research centres

• Encouragement to open-source foundational models

This helps explain the stock rallies seen in AI-related Chinese companies following such announcements.

Xiaomi’s AI Future: Beyond Smartphones

While Xiaomi’s smartphone business remains strong, the company is increasingly focused on building an ecosystem of smart, connected products — ranging from robot vacuums and air purifiers to now EVs and AI software.

With MiMo, Xiaomi aims to embed AI into its device ecosystem, providing intelligent assistants, predictive automation, and personalised user experiences.

Potential integrations include:

• Voice-enabled assistants on Xiaomi smartphones and TVs

• Smart home integration across appliances

• In-car AI assistants for Xiaomi EVs

This vertical integration of AI into products could give Xiaomi a competitive edge against both Western tech giants and Chinese hardware rivals.

Challenges and Outlook

Despite the hype, Xiaomi faces several challenges on its AI journey:

• Proving MiMo’s performance in real-world applications

• Competing with tech leaders like Baidu, Tencent, and Huawei

• Building trust after recent EV safety concerns

However, Xiaomi’s track record of entering saturated markets and finding success — as seen in smartphones and smart devices — gives it a strong foundation.

If the company continues investing in talent, infrastructure, and partnerships, it may well position itself as a leading AI hardware-software hybrid brand in the next few years.

Conclusion

With the launch of MiMo, Xiaomi has made a decisive entry into the AI race, signalling its ambition to shape the next wave of intelligent technology. While the road to artificial general intelligence is long and complex, Xiaomi’s move shows that AI is no longer just for tech purists — it’s becoming a core pillar of consumer tech brands.

Backed by government policy, market momentum, and cross-domain experience, Xiaomi’s entry into AI could redefine not just its product line-up but also China’s global tech narrative.

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