If you've been keeping an eye on the home router market, you're likely aware that, according to data from LoTu, Xiaomi clinched the top spot in online sales in 2025, outpacing giants like Huawei, TP-Link, and ZTE.

Xiaomi's market share soared to an impressive 30%, indicating that nearly one in every three routers sold bore the Xiaomi badge.

At that time, Xiaomi received widespread acclaim, with many marveling at how a newcomer could outshine established players in a market traditionally dominated by well-known router brands.

However, the heyday was short-lived. By 2026, the landscape had shifted, and Xiaomi could no longer maintain its leading position.

As depicted in the chart below, in the first half of 2026, also based on LoTu's data, Huawei had overtaken Xiaomi to seize the top spot. Whether measured by sales volume or revenue, Xiaomi found itself relegated to second place, underperforming compared to Huawei.

By August, the rankings had undergone another transformation. As illustrated below, Huawei retained its first-place standing in both sales volume (24.1%) and revenue (30.3%), although these figures had dipped by 6.0 and 6.5 percentage points year-on-year, respectively.

TP-Link ascended to second place, outpacing Xiaomi in both sales volume and revenue. Its specific sales volume share stood at 21.5%, marking a 1.5 percentage point increase.

Xiaomi's share, at 20.2%, trailed behind TP-Link's, consigning it to third place.

Meanwhile, ZTE witnessed a notable 15.6% year-on-year surge in August, with its market share climbing by 4.7 percentage points to 19.3%, inching ever closer to Xiaomi—just a single percentage point behind. It could be argued that if Xiaomi's downward trajectory persists, it may soon find itself in fourth place, unable to even keep pace with ZTE.

Faced with such outcomes, Lei Jun must be feeling somewhat awkward. After all, Xiaomi held the top spot last year, only to slide continuously to third place by 2026.

What led to this turn of events? Actually, it's not overly complex.

Owing to sharp spikes in the cost of storage chips and other components, router costs surged. Xiaomi, with its emphasis on cost-effectiveness, found itself unable to hike router prices. Consequently, it opted not to update its router product line in 2026 and actively curtailed shipments.

Secondly, the router market has evolved into a battleground for inventory competition. When many long-time users upgrade their routers, they tend to opt for pricier models. In consumers' minds, expensive products often justify their higher price tags. As a result, routers from Huawei, TP-Link, and ZTE, which command higher prices than Xiaomi's, have, to some extent, gained greater popularity.

Moving forward, it remains to be seen how Xiaomi will respond. Will it unveil new products to invigorate the market, or will it continue to bide its time until the storage chip price surge abates before making a move?