Xiaomi revenue jumps 30pc to third-quarter record

Agencies and staff reporter

Xiaomi (1810) posted a 30.5 percent jump in third-quarter revenue, exceeding expectations, as the smartphone giant gained a foothold in the cutthroat electric vehicle sector it entered in March with its SU7 sedan.

Revenue came in at a record 92.5 billion yuan (HK$99.4 billion) for the quarter ended September 30, beating an LSEG consensus estimate from 15 analysts of 91.1 billion yuan. About 9.5 billion yuan came from its EV venture.

Net income rose 9.8 percent from a year ago to 5.35 billion yuan for the quarter, versus an estimated 4.73 billion yuan from the analysts.

For the first nine months, the Beijing-based company reported a 14.8 percent growth in net profit to 14.6 billion yuan from a year ago.

Xiaomi raised its EV sales target yesterday and is now aiming for sales of 130,000 this year, far more than an initial goal of 76,000. To keep up with demand, the company has doubled production shifts since June and launched the premium SU7 Ultra model.

Xiaomi's auto business though is still operating at a loss. The unit reported an adjusted loss of 1.5 billion yuan for the quarter, with a gross profit margin of 17.1 percent.

A few months ago, the company purchased a plot of land in Beijing for 842 million yuan to expand electric car production following the early success of its debut sedan. It also aims to begin making and selling a sport utility vehicle similar to Tesla's Model Y as early as 2025.

"Such capacity expansion might not only boost Xiaomi's revenue growth but could also enlarge Xiaomi's scale advantage, which may eventually translate into better profitability," Morgan Stanley said in a report published ahead of the earnings release.

During the quarter, Xiaomi maintained its position as the world's third-largest smartphone maker with shipments of 42.8 million units, up 3 percent and capturing 14 percent of the market, according to research firm Canalys.

Meanwhile, smartphone rival Huawei started taking pre-orders for its Mate 70 model yesterday, according to a statement on its official WeChat account. It will also hold an event for the Mate brand on November 26, where it is expected to unveil its latest smartphone lineup.

The company's online store yesterday started allowing users to reserve the Mate 70 and two pro versions without requiring a deposit. The website did not disclose prices. It saw more than 270,000 orders received in the first five minutes of opening.

In other auto news, BYD (1211), the world's largest EV maker, celebrated a milestone yesterday in having rolled out 10 million new energy vehicles, which includes EVs and hybrid cars. It also pledged to invest 100 billion yuan in developing technology that combines artificial intelligence and autos.