The Chinese technology company, Xiaomi Corp., reported revenue growth of 55% on Wednesday. The company’s market share in China also increased to 75% year on year in the quarter ended late March, taking over Huawei as the leader of the smartphones sector. This comes after Huawei retreated from the market following U.S. restrictions that hindered the company’s ability to source key components for its handsets.
Xiaomi’s revenue rose to 76.88 billion yuan ($12 billion) in the first quarter of this year, from 49.70 billion yuan a year earlier. Adjusted net profit increased to 6.1 billion yuan this year. The Chinese company’s revenue from smartphone sales increased 69.8% year-over-year to 51.5 billion yuan, while revenue from internet services rose 11.4% to 6.6 billion yuan. ( 1US = 6.367873 CNY )
While Xiaomi and other electronics brands face a global chip shortage, the Chief Financial Officer told shareholders that the company’s chip inventories remain at healthy levels and did not expect a major impact on business this year.
Additionally, this quarter held major announcements from executives at Xiaomi Corporation. The company announced that it would start producing electric cars, with a new division lead by the founder. At the same time, the company wants to double the number of retail stores in China while investing more in e-commerce in India, one of the company’s key markets, as the country faces major lockdowns due to coronavirus.
The U.S. government recently reversed Donald Trump’s decision to ban U.S. investors from owning shares in the company.
References:
1) Reuters. (2021, May 26). Xiaomi revenue surges 55% in Q1, fills market gap left by Huawei. Reuters. https://www.reuters.com/technology/xiaomi-reports-55-surge-q1-revenue-2021-05-26/.
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