Virus causes disruptions on the Xiaomi lineBusiness | Reuters and Avery Chen 14 Feb 2020
Mainland-based smartphone maker Xiaomi (1810) expects its 2019 revenue to exceed 200 billion yuan (HK$222.4 billion) but warns of a hit to first-quarter sales caused by coronavirus strains.
That compares to a revenue of 175 billion yuan in the previous year.
And Xiaomi predicts its research and development expenses this year will be over 10 billion yuan against 7 billion yuan in 2019.
"This year's first-quarter smartphone sales will face an impact, but we believe that in the second and third quarters they will come back," chief executive Lei Jun said.
His remarks came at a launch event for Xiaomi's new Mi 10 flagship line of smartphones yesterday - live-streamed due to restrictions on travel and gatherings.
Lei said the company's capacity and stock was sufficient, but deliveries in the coming weeks might be affected as many factories in China had not resumed work until Monday.
He added that managing the supply chain was the toughest task at this time.
Also feeling virus strains was the Mobile World Congress, the annual telecoms industry gathering that draws more than 100,000 visitors to Barcelona. It was canceled after an exodus by exhibitors fearful of the coronavirus.
Meanwhile, the Pentagon is likely to back new US restrictions on Huawei Technologies, reversing its earlier opposition to a proposal meant to further crack down on exports to the blacklisted Chinese company.
The reversal will allow a rule first proposed by the US Commerce Department to advance and make it harder for US firms to get around the effective ban on exports to Huawei. But Britain and France will not be banning Huawei.
Other tech-linked news included Semiconductor Manufacturing International (0981) announcing its net profit surging 234.6 percent to US$88.7 million (HK$690 million) and revenue rising 3 percent to US$839.4 million for the fourth quarter of 2019. It expects its first-quarter revenue to grow 0-2 percent on that.
And net profit for Hua Hong Semiconductor (1347) fell 11.4 percent to US$162.2 million last year, with basic earnings per share of US$0.12. It expects first-quarter revenue to be around US$200 million.