Xiaomi Corp’s shares advanced 6.8% to HK$27.96 by 03:28 GMT on Wednesday, following the release of second-quarter earnings that highlighted resilience in its electric vehicle and AI segments despite persistent weakness in smartphones.
Revenue declined 6.1% year-on-year to 108.9 billion yuan ($16.15 billion), while adjusted net profit dropped 42.6% to 6.2 billion yuan. Gross margin contracted to 19.8% from 22.0% in the prior quarter, reflecting ongoing cost pressures in components such as memory chips, which remained elevated during the period.
The company’s Smart EV, AI, and New Initiatives segment generated 24.9 billion yuan in revenue, up 17.1% from a year earlier, driven by a 15.9% increase in EV revenue to 23.9 billion yuan. Vehicle deliveries surged 28.2% to 104,199 units, with cumulative deliveries of the SU7-series exceeding 500,000 by August 17. New SkyNomad SUV models are scheduled for launch in September.
Xiaomi’s smartphone business continued to face headwinds, with shipments falling 26.5% to 31.2 million units amid weaker global demand and higher component costs. Average selling prices rose 25.9% to a record 1,351 yuan as the company prioritized premium models to offset volume declines.
President William Lu noted during a post-earnings call that memory costs remained at historically high levels in Q2, weighing on margins for smartphones and tablets. However, he indicated that the pace of memory price increases has begun to slow and is expected to ease further in the second half of the year, signaling potential relief for cost pressures in the smartphone segment.
