ZTE Corp. showcased for the first time a lineup of co-designed smartphones with built-in AI services, joining a growing number of Chinese companies trying to reimagine mobile devices with artificial intelligence at the core.
The state-backed wireless firm demo-ed the NaviX Ultra, which it called the world’s first agentic AI smartphone, at China’s premier tech summit this week in Shanghai. It comes in four colors — black, pink, white and blue — and pulls up ByteDance Ltd.’s popular AI agent Doubao with a voice command or the press of a button.
The demo followed the unveiling this week of a similar device from StepFun, which sports a proprietary operating system and built-in agent Amoo. Honor, the smartphone maker spun off from Huawei Technologies Co., is also showcasing an AI agent, drawing on models co-developed with Alibaba Group Holding Ltd. It will run on a new generation of devices later this year.
The spate of launches underscore a global effort to re-imagine a two-decade-old platform walloped by soaring memory costs, inflation and the advent of AI. Last year, OpenAI paid $6.5 billion to buy a design consultancy run by legendary Apple hardware chief Jony Ive, launching a project to conceive an AI device.
The movement emerged with the global smartphone market bracing for its steepest-ever decline this year. The squeeze hit Chinese smartphone manufacturers particularly hard, because many sell budget devices with lower margins and less pricing power.
The idea now is to design an agentic layer in the operating system that allows AI to execute user’s prompts autonomously across different apps, according to Arthur Guo, research manager at IDC China. The agent draws on AI models from both the device and cloud: The on-device model tackles frequent tasks that require minimal lag time, while cloud-based models do the heavy-lifting on complicated tasks, Guo said.
It represents Chinese manufacturers’ latest bid to find growth in a sluggish market where features such as better camera and foldable screens provide a modest sales boost at best.
ZTE and ByteDance are hoping to break a yearslong cycle of incremental improvements on screens, cameras and power. Along with its rivals, they aim to tap Chinese’s enthusiasm for AI.
New agentic phones are likely to deepen a battle for consumers between Chinese companies and Apple Inc., which has staged a strong comeback in China since late last year and just received Beijing’s blessing to roll out Apple Intelligence in the country, through partnerships with Alibaba and Baidu Inc.
ZTE unveiled a prototype of its device in December that cost 3,499 yuan ($516), as part of its broader Nubia smartphone brand. The initial 30,000 run quickly sold out before doubling in price on the used market, according to local media outlet Jiemian.
“Apple has indeed brought many innovations on the AI front. But in terms of AI smart devices, we are ahead of Apple,” Nubia chief Ni Fei said in a video posted on his Weibo account in June.
On Friday, Ni took to the showfloor at the World AI Conference in Shanghai to demonstrate his product to constant throngs of visitors. Wearing a black T-shirt with the slogan “Nubia, just Doubao it” on its back, he sped through actions from real-time editing of photos to map creation and trip planning. But he remained tight-lipped on the new device’s specifications, which the company will disclose later this year.
To go mainstream, developers need first to undergo a mindset shift, Ni said. They need to move from adding functions to creating an agent that focuses on getting things done, he said in another Weibo post this week. Many so-called AI phones on the market simply stack AI functions on top of an existing system. That actually makes it more cumbersome for users, he added.
“AI phone could be the sole growth trajectory” for China this year, IDC’s Guo said. More than half of the market could de dominated by such devices in 2026, he added. “AI functionality may not be the primary consideration driving purchase, but consumers have grown reliant on the convenience brought by AI.”
