Xiaomi Inc., a Chinese technology giant, will open its first offline store in South Korea next week, about six months after its virtual foray into the country, accelerating its push to crack the country's premium electronics market long dominated by Samsung Electronics Co. and LG Electronics Inc.
According to industry sources on Sunday, Xiaomi will open its first Korean offline store, called Mi Store this Saturday in Yeouido, Seoul’s financial district.
It will start selling smartphones, tablet PCs and small appliances in phases and then expand into large appliances, such as refrigerators and washing machines, next year.
The company is targeting Korea’s premium electronics segment, currently led by domestic players Samsung and LG. Under the plan, it is said to be preparing to open after-sale service centers in Korea to support its high-end product lines, sources said.
The physical store opening comes just six months after it set up its Korean operations in early January with the official launch of its online store for Korean consumers.
Xiaomi smart bands (Courtesy of Xiaomi) Once dismissed as an Apple copycat offering bang-for-the-buck gadgets, Xiaomi has grown into a major global player in the 15 years since its founding. As of the first quarter of this year, it held a 14% share of the global smartphone market, ranking third behind Samsung and Apple Inc.
It led the global smartwatch market with a 19% share.
Beyond consumer devices, Xiaomi has built its proprietary operating system (OS) and artificial intelligence (AI) powered by its own large language models.
It also self-designs application processors (APs), which act as the "brain" of smartphones, and produces upmarket electric vehicles and humanoid robots.
Appliances are the latest addition to Xiaomi’s extensive high-end portfolio, which has successfully landed in various markets thanks to the company’s advanced technology and design capabilities built by its aggressive research and development investments.
These efforts helped the company report a net profit of over 2 trillion won ($1.5 billion) in the first quarter of this year, up 65% from the same period last year. Sales leaped 47% to 21 trillion won over the same period.
Xiaomi SU7 Ultra (Courtesy of Xiaomi) FROM BUDGET BRAND TO PREMIUM CHALLENGER
In 2014, Xiaomi Chief Executive Lei Jun vowed to catch up to Samsung Electronics and Apple in five to ten years, a claim that at the time seemed far-fetched.
But in the first quarter of 2024, Xiaomi ranked third globally in smartphone sales, closely trailing Samsung with 20% and Apple at 19%.
It is even ahead of its Korean rival in smartphone OS technology, as it uses a proprietary OS, dubbed MIUI, for its smartphones. It has also developed electric vehicles, a move abandoned by the iPhone maker.
Xiaomi's growth has been largely fueled by its strategic pivot from budget offerings to premium positioning, which caused its sales to more than quintuple to 69.4 trillion won in 2024 from 2015. It also swung from losses to a profit over the same period.
Xiaomi CEO Lei Jun speaks during the launch of Xiaomi's XRING O1 chipset in Beijing on May 22, 2025 (Courtesy of AFP via Yonhap) Its flagship premium Xiaomi Ultra 15 smartphone, fitted with Leica Camera AG’s cameras, sold like hotcakes despite a high price tag.
Xiaomi shipped 170 million smartphones in 2024, up 15% from the previous year. Its stock price nearly tripled over the past six months and it has become China’s largest smartphone company in the first quarter.
Its market value stood at 245 trillion won, surpassing Korea’s No. 2 market cap stock, SK Hynix Inc.
LOCK-IN EFFECT
Another pillar of Xiaomi’s strategy is its extensively integrated ecosystem, powered by the MI app, which allows users to control a wide range of Xiaomi devices, spanning TVs, vacuum cleaners, EVs and more.
They are all connected via Xiaomi’s AI and Internet of Things (IoT), causing Xiaomi smartphone users to stay loyal to the company’s other devices or appliances, nearly 200 products, creating a strong lock-in effect.
Xiaomi humanoid (Courtesy of Xiaomi) Its R&D spending on the ecosystem expansion increased 35% annually on average from 2017 to 2023. It earmarked 30 billion yuan ($4.2 billion) this year to upgrade its OS and semiconductor technology and develop EVs.
The company is expected to continue evolving through massive investments in future technologies, industry observers said.
It has pledged to invest $6.9 billion in semiconductor development over the next decade. Separately, it has already spent $1.9 billion on its first self-designed 3-nanometer system-on-a-chip (SoC), the XRing O1, unveiled to the world in late May.
Xiomi is now the world’s fourth company to develop a 3-nm chip after Apple, Qualcomm and MediaTek.
Industry watchers expect Xiaomi to continue its aggressive expansion into future technologies such as AI and robotics.
The Chinese government’s generous support for the country’s homegrown technology is also expected to drive Xiaomi’s growthd, industry observers said.
Write to Chae-Yeon Kim at why29@hankyung.com Sookyung Seo edited this article.
