By
Chimamanda U. Martha
December 28th, 2023
Xiaomi more than doubled net income to $716 million in the Q2, beating the highest analyst estimate. Sales increased by 3.1% to 53.5 billion yuan. Xiaomi’s overseas business has recovered to pre-COVID-19 levels.
Chinese electronics company Xiaomi Corporation (HKG: 1810) announced revenue of $7.77 billion for the Q2 that ended in June this year. That represents a rise of 3.1% since the same period last year and more than a 7.7% growth during the previous quarter as the Chinese smartphone maker is noticing a rise in most of its overseas markets.
The company, which appointed Alain Lam (former APAC senior executive from Credit Suisse) as its new CFO this week, stated its profit in the second quarter was $650 million, representing a rise of 129.8% year-on-year and 108% in comparison to the first quarter of 2020.
Its smartphone sales, which still account for the majority of its revenue, has seen a recovery in most of its international markets. According to the official announcement, excluding India, the average daily number of overseas smartphone activations surpassed 120% of the pre-pandemic level that was seen back in January 2020.
For Xiaomi in Q2 India Still Not at Pre-Pandemic Level
India, however, is Xiaomi’s biggest market outside of China and represents a totally different story. New Delhi ordered a nationwide lockdown already in March and therefore, most of the shops across the country closed as well. Package delivery of “non-essential” items ordered online were also pretty much restricted or even halted for months.
Even as India, where Xiaomi has been the top smartphone dealer for the last 12 quarters, has allayed lockdown restrictions in the months since, the daily number of smartphone activations were still at 72% (compared to January 2020) as of last month.
Xiaomi stated that since the production capacity had not yet returned to the normal level, the company’s sales were still limited by the production constraints.
The company stated:
“In the first half of 2020, despite the impact of COVID-19 and great global uncertainties, Xiaomi’s diversified business ecosystem has demonstrated its resilience, as both revenue and adjusted profits beat market consensus, while our operations continued to expand. We made the Fortune Global 500 list for the second time, ranking 422nd, up 46 places from last year. With 2020 being Xiaomi’s 10th anniversary, we have upgraded our core strategy to ‘Smartphone X AIoT’, with AIoT revolving around our core smartphone business, enabling us to lead the future way of smart living. Looking forward to the next decade, we will firmly adhere to our ‘three guiding principles’ – never cease to explore and innovate, continue to offer products with strong price-to-performance ratio, and seek to make the coolest products, so as to let everyone in the world enjoy a better life.”
European Share Stands at 16.8%
According to research firm Canalys, Xiaomi’s smartphone shipments grew by 64.9% year-on-year in Europe, achieving a total market share of 16.8%.
In Western Europe, Xiaomi’s smartphone shipments went up by 115.9% year-on-year, accounting for a 12.4% market share. Similarly, Xiaomi commanded the top smartphone vendor position in Spain, second in France, and 4th in Germany and Italy. In Eastern Europe, Xiaomi became the No.1 smartphone company in Ukraine and Poland in terms of smartphone shipments, with respective market shares of 37.1% and 27.5%.
Recently, Xiaomi Founder, Chairman and CEO Mr. Lei Jun distributed a letter to employee, announcing that Xiaomi’s core strategy will be upgraded to “Smartphone x AIoT” in the next decade to drive synergistic benefits, “with smartphone remains as the cornerstone to the Group’s business, while AIoT will build a smart life around smartphones to let Xiaomi truly lead the future way of smart living.”
At the time of writing, Xiaomi shares were trading 5.74% higher at HK$19.16.
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