Oppo established its in-house chip unit, called Zeku, in 2019
With the global semiconductor market still facing shortages, political tension and other setbacks, Chinese smartphone maker Oppo has announced the abrupt closure of its in-house chip design unit.
“Due to the uncertainties in the global economy and the smartphone industry, we have to make difficult adjustments for long-term development,” a company representative said in a statement.
Oppo’s chip segment, called Zeku, was created as a play for increased self-sufficiency. The unit was established in 2019 and released products like the MariSilicon X chip, a neural processing unit (NPU) that improves the quality of smartphone video and images. The chip, used in the company’s Find X series smartphones, was manufactured by TSMC using its 6-nanometre node process, which is now subject to U.S. semiconductor sanctions, which include any chips under the 14-nm threshold.
As a result of these sanctions, China’s fabless firms are finding it exceedingly difficult to find manufacturers for their designs. TSMC, for example, was manufacturing chips for Huawei, but dropped the deal once the U.S. sanctions hit. And while Oppo is not a target of the U.S. government, updates made last year to export controls effectively ban the export to China of advanced chips or chip-making equipment without approval.
Beyond the semiconductor challenges facing Oppo, 2022 was one of the worst years for global smartphone shipments in nearly a decade, according to numerous reports. Analyst firm Canalys reported that global shipments dropping roughly 11% last year, and that the highest drop was recorded in the final quarter, with worldwide shipments falling 17% from the previous year. All in all, said Canalys, the total number of shipments for the entire year came in under 1.2 billion.
With the uncertainties stacking up, it appears that Oppo is looking to shift its strategy, although the company’s next steps remain unclear.
On its website, Zeku says it has offices in San Diego and Palo Alto, California and Yokohama, Japan. It is unclear at this time how many employees will be impacted by the closure.
