Xiaomi profit misses as phone shipments slump
SingTao · 2 SOURCESabout 3 hours ago3 MIN
Summary
Xiaomi Group reported adjusted profit of RMB6.22 billion for the second quarter of 2026, down 42.6% year on year and below the market forecast of RMB6.31 billion. Quarterly revenue fell 6.1% to RMB108.92 billion, slightly ahead of the consensus estimate of RMB108.33 billion, as weakness in its core phone and AIoT business contrasted with growth in electric vehicles and other newer operations
Key Points
- Xiaomi's smartphone x AIoT segment generated RMB84.0 billion in second-quarter revenue, down 11.3% from a year earlier
- Smartphone revenue fell 7.5% to RMB42.1 billion after shipments dropped 26.5% to 31.2 million units from 42.4 million.
- Despite lower volume, smartphone average selling price rose 25.9% year on year to a record RMB1,351 per handset
- Smart electric vehicles and other new initiatives, including AI, posted RMB24.9 billion in revenue, up 17.1% year on year
- New vehicle deliveries reached 104,199 in the quarter, up 28.2%, while connected AIoT devices rose to 1.16 billion by June 30.
- Xiaomi said the drop in smartphone shipments was tied to product mix optimisation, with deliberate cuts to lower-end models, while rising core component prices and softer global demand also weighed on sales. The company said stronger pricing came from a better product mix, a higher share of mainland China shipments, and the May launch of the Xiaomi 17T series, which lifted overseas average selling prices. IoT and lifestyle product revenue fell 19.2% to RMB31.3 billion, which Xiaomi attributed mainly to the fading of state subsidy support in mainland China, although overseas growth in tablets, smart TVs and wearables partly offset the decline
- In the automotive business, revenue from smart electric vehicles rose 15.9% to RMB23.9 billion. Xiaomi delivered more vehicles mainly because shipments of the Xiaomi YU7 series increased, though that was partly offset by lower deliveries of the Xiaomi SU7 Ultra. Vehicle average selling price fell 9.6% year on year to about RMB229,300 because the contribution from the higher-priced SU7 Ultra declined. Other related revenue jumped 56.5% to RMB1.0 billion, driven by after-sales service income and AI revenue linked to the Xiaomi MiMo large model
- According to Omdia data cited by Xiaomi, the group has ranked among the global top three in smartphone shipments for 24 consecutive quarters. As of June 30, the number of connected devices on Xiaomi's AIoT platform, excluding smartphones and tablets, reached 1.16 billion, up 17.4% year on year and a record high. Global monthly active users of Xiaomi devices reached 766 million in June, up 4.8% from a year earlier, also a record high
Why It Matters
For Hong Kong investors, the quarter shows Xiaomi is relying more heavily on higher-end phones and its car business to offset weaker unit sales in mass-market devices. The figures also suggest the group's earnings path may stay sensitive to handset demand, subsidy changes and the sales mix of newer vehicle models.