Oppo has closed its chip design subsidiary, Zeku , due to uncertainties in the global economy and the smartphone market . The news shocked employees, who received less than a day’s notice.
Bad news for innovation. Chinese smartphone maker Oppo has suddenly shut down its chip design subsidiary Zeku , leaving employees stunned. The company announced the move on Friday with a brief statement, attributing the decision to “uncertainties in the global economy and the smartphone market” and calling it “difficult.
The news shocked Zeku employees, who received less than a day’s notice. An employee, who declined to be named, told the South China Morning Post that the workers were told on Thursday not to come to the office the next day. “I can’t even go back to the office to pick up my laptop,” the clerk said. Oppo declined to comment beyond his statement on Friday.
This represents a cautionary tale for Chinese companies seeking government-sponsored self-sufficiency in semiconductors.
The smartphone market is declining, which has affected Oppo, one of the biggest Chinese smartphone brands. In response, the company created Zeku in 2019 to design chips for its devices, and has been aggressively recruiting for years. However, just two weeks ago, the company shut down Zeku, putting thousands of employees out of work.
Job postings posted by Zeku included dozens of positions, such as chip architecture engineers, chip verification and software programmers, in locations including Shanghai, Beijing, Chengdu and Xian. The company had described its business on its website as a provider of cutting-edge semiconductor systems, with offices in San Diego and Palo Alto in California and Yokohama, Japan. Employees estimated that the company had nearly 3,000 workers before it closed.
MariSilicon X, Oppo’s hope at the time
Marisilicon X was the first chip designed by Oppo, one of the largest Chinese smartphone brands, to enhance the image processing power of its mobile devices by reducing the processing load on the device’s CPU and allowing other components to complement the work for additional tasks without dent in the use of resources of the SoC.
The Marisilicon X features a dedicated Neural Processing Unit (NPU) that enables the device to quickly process large amounts of image data, resulting in sharper, better quality photos in low light conditions. light.
China and chip brands
Zeku’s shutdown comes in a difficult environment for factory-free chip design companies in China. Chip procurement has been hampered by increasing US export restrictions targeting advanced semiconductors. Of the 3,243 factory-free chip companies in China last year, only 566 had sales exceeding 100 million yuan ($14.4 million), according to Wei Shaojun, president of integrated circuit design at the China Semiconductor Industry Association. China (CSIA).
Oppo isn’t the only Chinese smartphone company to have created its own chip company. Huawei Technologies had already done the same with its subsidiary HiSilicon, while Xiaomi has also established its own chip company. The move has been taken to design chips that can be used in its devices and to reduce its dependence on foreign suppliers.
In the first quarter, Oppo ranked fourth in global smartphone shipments. However, the company’s shipments have been affected by the decline in the smartphone market, falling 22% last year to 103 million units, according to IDC data. Zeku’s closure may be an attempt by Oppo to cut costs in an increasingly difficult market.