Xiaomi begins another round of layoffs

Xiaomi (1810) is holding another round of layoffs, with several thousand employees facing a job cut.

But China's smartphone maker said that the scale of job cuts would not be as large as previously estimated.

The clarification is in response to an earlier report that the company would dismiss about 15 percent of total jobs - or about 5,000 employees - involving various departments. The rate of layoffs in individual departments in China could be up to 75 percent, while the internet of things department could reach a dismissal rate of up to 40 percent.

Xiaomi had a total of 35,314 full-time employees as of September - of which 32,609 were in China.

The employees laid off will be compensated with a salary based on their working years in the company plus a two-month wage.

In August, Xiaomi had reportedly fired 3 percent of its workforce - over 900 employees - to reduce operation costs after second-quarter revenue slumped 20 percent to 70.2 billion yuan (HK$78.3 billion) from one year ago.

Further, Chinese smartphone shipments are expected to decline 0.9 percent yearly in 2023, a report by IDC showed.

This came when China's business confidence fell to its lowest since January 2013, a survey by World Economics showed, reflecting the impact of surging Covid cases on economic activity in tandem with the abrupt lifting of many pandemic control measures.

The index fell to 48.1 in December from 51.8 in November - the lowest since the survey began in 2013.

Shares of Xiaomi fell 1.82 percent to HK$10.78 yesterday.

Staff reporter and Reuters