Xiaomi has just reported its strongest financial results yet, with first-quarter revenue hitting a record 111.3 billion yuan ($15.48 billion) and adjusted net profit crossing the 10 billion yuan for the first time.
This is a 64.5% surge in profit compared to the same period last year, resulting from the company’s recent focus on premium products and its move toward the electric vehicle (EV) sector.
The numbers beat market expectations across the board. Analysts had projected revenue of 107.6 billion yuan and profit of around 8.96 billion yuan. Instead, Xiaomi came in far stronger, showing that its move away from low-margin devices is paying off.
President Lu Weibing addressed the press after the results were released, saying: “Our strategy to focus on high-end products from smartphones to home appliances has yielded a positive outcome.”
For context, Xiaomi is no longer just a phone company. It now plays in the EV market, home appliances, and beyond. Its latest product, the YU7 electric SUV, is scheduled to launch in July.
Though pricing hasn’t been disclosed, Xiaomi hinted it will cost 60,000 to 70,000 yuan more than Tesla’s popular Model Y, currently priced from 263,500 yuan.
Its first EV, the SU7, hit the market with Porsche-inspired aesthetics and a lower price tag than Tesla’s Model 3. That was a calculated shot and it worked.
Since December, Xiaomi has been outselling the Model 3 in China on a monthly basis. As of now, the company has delivered over 258,000 SU7 units.
The EV business alone brought in 18.1 billion yuan this past quarter, with 75,869 SU7 sedans delivered.
But then, in late March, a fatal accident involving an SU7 using driver-assist technology caused some issues. Orders have slowed, and the issue was compounded by queries over misleading marketing. Xiaomi has since issued an apology, admitting its promotional materials were “not clear enough”.
However, investors are back on track. Xiaomi’s market value has climbed to roughly $170 billion, overtaking BYD’s $161 billion. That’s big as BYD is China’s largest EV maker.
In the smartphone space, Xiaomi shipped 41.8 million units globally in Q1, up 3% year-on-year, holding its place as the third-largest smartphone vendor worldwide with a 14.1% market share.
