Introduction:
London-based tech startup Nothing has taken a bold step in its expansion strategy by announcing the spin-off of its affordable sub-brand CMF into an independent subsidiary, with India serving as its global headquarters for operations, research, and development. Revealed on September 25, 2025, via a post from CEO Carl Pei on X, the move establishes a joint venture with Indian electronics manufacturer Optiemus Infracom, backed by a $100 million investment over the next three years. This initiative aims to position CMF-Nothing's entry into the budget market-as India's first truly global consumer tech brand, focusing on smartphones, wearables, and accessories priced under $200.
Nothing, founded in 2020 by former OnePlus co-founder Carl Pei, has rapidly grown to a $1.3 billion valuation after raising $200 million in Series C funding led by Tiger Global and including Indian investor Nikhil Kamath. CMF, launched in 2023 as "Color, Material, Finish," has been instrumental in this ascent, driving Nothing's 85% year-over-year shipment growth in India during Q2 2025, according to IDC data. By separating CMF, Nothing can maintain its premium identity in the $400-$600 segment while allowing the sub-brand to scale independently in the budget arena, where 42% of Indian smartphone shipments fall in the $100-$200 range.
The joint venture with Optiemus, a Noida-based firm known for manufacturing for brands like Lava and Karbonn, will create over 1,800 jobs and enhance local production capabilities, aligning with India's Atmanirbhar Bharat and Make in India initiatives. Pei highlighted India's pivotal role in the global smartphone industry, noting CMF's strong reception since its debut with the CMF Phone 1. Recent hires like Himanshu Tondon from Xiaomi's POCO as CMF's VP of Business underscore the commitment. Why does this matter? In a market projected to reach $100 billion by 2027, this spin-off could accelerate Nothing's growth, foster innovation in affordable tech, and boost India's manufacturing ecosystem. This article details the announcement, strategic rationale, CMF's portfolio, investment plans, market context, expert analyses, and future outlook.
The Announcement: CMF's Independence and Joint Venture
Carl Pei announced the spin-off on September 25, 2025, via X, stating: "India will play a key role in shaping the future of the global smartphone industry. We discussed our journey with Optiemus... Our joint venture with Optiemus is a key milestone toward making that vision a reality." The partnership with Optiemus Infracom, a subsidiary of Sahasra Group, will focus on end-to-end manufacturing, R&D, and exports of CMF products, including smartphones and wearables.
Nothing has already invested over $200 million in India, including a Noida R&D center and manufacturing partnerships. The new $100 million commitment over three years will scale CMF's operations, targeting the budget segment where it has excelled-CMF Phone 2 Pro, launched in April 2025, became a bestseller under $300. Pei envisions CMF as a "truly global" brand, leveraging India's talent pool and supply chain.
Strategic Rationale: Why Spin Off CMF Now?
The decision to make CMF independent stems from market dynamics and Nothing's growth strategy:
- Budget Segment Focus: CMF targets the $100-$200 range, where Nothing avoids cannibalization of its premium lineup (e.g., Phone (3a) at $500+).
- India's Market Potential: As the second-largest smartphone market, India accounts for 20% of Nothing's shipments, with CMF driving 60% of that volume, per IDC.
- Manufacturing Scale: Partnering with Optiemus enables "Make in India" compliance, reducing import duties and creating local jobs.
- Global Ambition: Pei aims for CMF to rival Xiaomi's Redmi or Samsung's A-series, with exports to Southeast Asia and Africa.
This mirrors strategies like Xiaomi's POCO spin-off (2018) and Huawei's Honor sale (2020), allowing focused innovation without diluting parent brand value.
CMF Portfolio: From Phones to Wearables
Since its 2023 debut, CMF has built a diverse lineup emphasizing design and affordability:
- Smartphones: CMF Phone 1 (2023, $209), Phone 2 Pro (April 2025, $279)-both with Dimensity chips, 50MP cameras, and 5,000mAh batteries.
- Wearables: CMF Watch Pro (2023, $69), Watch 3 Pro (September 2025, $99)-featuring AMOLED displays, health tracking, and 10-day battery.
- Audio: CMF Buds (2023, $39), Buds 2 (upcoming, $49)-with ANC and 35-hour playtime.
- Accessories: Power adapters and cases under $20.
CMF's success in India-85% YoY growth-stems from "design-led innovation" resonating with young urban consumers, per Canalys analyst Sanyam Chaurasia.
Investment and Job Creation: Boosting India's Tech Ecosystem
The $100 million JV with Optiemus will fund:
- Manufacturing: New facilities in Noida for 5 million+ units annually.
- R&D: Dedicated team for budget innovations, creating 1,800 jobs over three years.
- Exports: Targeting 20% global shipments from India by 2028.
Optiemus Chairman Ashok Gupta noted: "Global brands choosing India to build is a testament to the ecosystem's strength." This aligns with India's $300 billion electronics target by 2026.
Market Context: India's Budget Smartphone Boom
India's smartphone market grew 7% YoY in Q2 2025 to 50 million units, with the $100-$200 segment at 42%, per IDC. Nothing's 229% growth, led by CMF, outpaced Vivo (14%) and Oppo (12%). The spin-off positions CMF to capture 5% share by 2027, rivaling Realme and POCO.
Challenges: Intense competition, supply chain disruptions. Opportunities: Government incentives under PLI scheme.
Expert Opinions: Strategic Move Praised
Navkendar Singh (IDC India): "Makes sense; CMF's budget focus won't dilute Nothing's premium image." Carl Pei: "India shapes global tech; CMF will be its first global brand." Ashok Gupta (Optiemus): "Testament to Make in India." Consensus: Smart for scaling, job creation.
Potential Impacts: On Nothing, CMF, and India
For Nothing: Frees resources for premium products like Phone (3). For CMF: Independent agility to hit $1B revenue by 2028. For India: 1,800 jobs, $100M FDI, boosting electronics exports. Risks: Execution delays; opportunities: Local innovation hub.
Conclusion: A Game-Changer for Nothing and India
Nothing's September 25, 2025, spin-off of CMF into an India-based subsidiary with a $100 million Optiemus JV is a masterstroke for budget tech growth. With 85% shipment surge, it cements India's role in global innovation. Watch for CMF Buds 2 on September 29-more tech news on nuvexic.com.
FAQ
What is Nothing spinning off?
CMF as an independent subsidiary in India.
Investment amount?
$100 million over three years.
Partner company?
Optiemus Infracom.
Jobs created?
Over 1,800.
Why now?
To scale budget segment without diluting Nothing's premium focus.