Company Reports

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its Internet of Things, or IoT, products to help build this ecosystem. During its IPO in 2018, the company committed to limiting its margins on hardware products (smartphones and IoT) to 5%, but in 2019, it started a premiumization strategy, helped by Huawei pulling out of the market, and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi's second-quarter results were again marred by weakness in its smartphone and lifestyle businesses, alongside investment in artificial intelligence, with consolidated revenue down 6% and underlying operating profit down 52%.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its Internet of Things, or IoT, products to help build this ecosystem. During its IPO in 2018, the company committed to limiting its margins on hardware products (smartphones and IoT) to 5%, but in 2019, it started a premiumization strategy, helped by Huawei pulling out of the market, and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi's first-quarter result was again marred by weakness in the smartphone and lifestyle businesses, with consolidated revenue down 11% and underlying operating profit down 60%. While up 6.9% year-on-year, EV revenue was also lower than each of the last three quarters of 2025.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its Internet of Things, or IoT, products to help build this ecosystem. During its IPO in 2018, the company committed to limiting its margins on hardware products (smartphones and IoT) to 5%, but in 2019, it started a premiumization strategy, helped by Huawei pulling out of the market, and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped by Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi's fourth-quarter result was marred by weakness in the smartphone and lifestyle businesses, with consolidated revenue up 7% and underlying operating profit down 27%. Ex-auto revenue declined 14%, with smartphone revenue declining by 14% and lifestyle products down 20%.

Xiaomi's third-quarter result showed continued strong momentum in the electric vehicle business but weakness in the smartphone and lifestyle business, with consolidated revenue up 22% and underlying operating profit up 81%. Ex-auto revenue grew only around 2%.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped by Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi's second-quarter results showed continued strong momentum in the electric vehicle business and the Internet of Things and lifestyle business, driving consolidated revenue up 31% and underlying operating profit up 51%.

Xiaomi's first-quarter result showed continued strong momentum in the electric vehicle business and Internet of Things and lifestyle business, driving consolidated revenue up 47% and adjusted net profit up 65%.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped by Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped by Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi's fourth-quarter result showed continued strong momentum in the electric vehicle business, driving consolidated revenue up 49% and adjusted net profit up 69%.

Xiaomi's third-quarter result showed strong momentum in the electric vehicle business, driving consolidated revenue up 31% and operating profit up 6.5%.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped by Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi’s second-quarter 2024 result exceeded our expectations, with the electric vehicles segment reporting a gross margin of 15.4% in the first quarter of selling EVs. Xiaomi indicated that the EV business contributed around CNY 2 billion in operating losses. Still, we estimate this is broadly in line with the research and development and other startup costs booked before the EVs started selling. Consolidated second-quarter revenue increased by 32%, with operating profit excluding investment valuation changes also up 46% to CNY 6 billion. This was the highest quarterly operating profit since the first quarter of 2021 despite it being the first quarter to include EV sales. The company’s margins are increasing across its portfolio due to increasing scale and premiumization.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped by Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Investors in Xiaomi will be hoping the company can leverage its proven ability to manufacture and market good value-for-money smartphone hardware into a sticky software ecosystem that will allow the company to increase its margins and returns. It will also try to use its "Internet of Things" products to help build this ecosystem. During its IPO in 2018 the company committed to limit its margins on hardware products (smartphones and Internet of Things) to 5%, but in 2019 it started a premiumization strategy, helped with Huawei pulling out of the market and has been increasing its mix of higher-end products ever since. We expect this pivot toward higher-end products to continue over the next four to five years as it helps revenue growth and increases gross margins.

Xiaomi’s first-quarter 2024 result was slightly above our expectations. Year-on-year growth was strong, with revenue increasing 27% and gross margins holding at 22.3% despite component price increases. Operating profit, excluding investment valuation changes, was also up 101% to CNY 4.8 billion, but we note that the first quarter of 2023 was a weak comparable. First-quarter 2024 profitability was similar to the third and fourth quarters of 2023. The company also continues to spend strongly on research and development, with related expenses up 25% year on year to CNY 5.2 billion, driven in part by spending on smart electric vehicles and other growth initiatives such as robotics. We await the second-quarter result to see how profitable the strong initial electric vehicle sales are.