Xiaomi posts record revenue of US$16 billion in second quarter on strong electric vehicle sales

Chinese tech giant Xiaomi posted a 30.5 per cent increase in revenue for the second quarter, driven by strong demand for electric vehicles (EVs), even though its core smartphone business experienced flat sales.

Xiaomi on Tuesday reported revenue of 116 billion yuan (US$16.1 billion) for the three months ended June, a record high that beat analysts' estimates of 114.94 billion yuan.

Net profit for the period also reached a record at 10.8 billion yuan, a 75.4 per cent year-on-year increase, exceeding the 8.88 billion yuan forecast by analysts.

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Xiaomi's Hong Kong-listed shares closed down 1.23 per cent to HK$52.40 on Tuesday, ahead of the quarterly earnings release.

In a post-earnings call with analysts, Xiaomi partner and president Lu Weibing said the company expected to enter Europe's EV market in 2027.

"We're not only confident in the next success of Xiaomi Automobile, but also in the success of [our] methodology," Lu said. Founded in 2021, Xiaomi Automobile is the Beijing-based company's EV division.

Revenue from Xiaomi's smart EV, artificial intelligence (AI) and other new initiatives business segment reached 21.3 billion yuan in the second quarter.

Xiaomi founder, chairman and CEO Lei Jun speaks during the launch of the YU7 electric SUV in Beijing on May 22, 2025. Photo: AFP alt=Xiaomi founder, chairman and CEO Lei Jun speaks during the launch of the YU7 electric SUV in Beijing on May 22, 2025. Photo: AFP>

With smartphone sales stagnating, EVs were the primary source of growth for Xiaomi, according to Dan Baker, a senior equity analyst at investment consultancy Morningstar.

In an earlier conference call with media to discuss the quarterly results, Lu - who also heads Xiaomi's smartphone business - highlighted the importance of premium branding to drive growth in a sluggish market.

"We will follow the strategies of developing hardcore technology and premium branding, going after global markets and building ecosystems ... to sustain our various businesses [over the] long term and [achieve] healthy growth," Lu said.

Xiaomi's smartphone business saw flat sales in the second quarter, with 42.4 million units shipped globally, representing 0.6 per cent year-on-year growth, according to market consultancy Canalys.

The company held its position as the world's third-largest smartphone vendor in the period, behind Samsung Electronics and Apple, while regaining the top spot in Southeast Asia after losing the crown for the past four years, Canalys said.

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Xiaomi's smartphone business recorded flat sales in the second quarter. Photo: Shutterstock alt=Xiaomi's smartphone business recorded flat sales in the second quarter. Photo: Shutterstock>

Following the successful launch of its first EV, the SU7, Xiaomi in June officially released its first electric SUV - the YU7. The new model was seen as a game changer in the premium EV segment, directly challenging Tesla's Model Y.

Priced between 253,500 yuan and 329,900 yuan, the YU7 has received an enthusiastic response from Chinese consumers, who placed 200,000 pre-orders within just three minutes after bookings opened on June 26.

However, Xiaomi's EV business may face short-term challenges, as production capacity bottlenecks had impacted the delivery of the YU7, according to Wang Hanyang, an analyst at investment consultancy 86Research.

"Investors will be focused on the progress of capacity ramp-up at the second factory," Wang said ahead of Xiaomi's earnings release.

In June, the company debuted its first pair of AI-powered glasses, emerging as a "dark horse" in the competitive market for smart eyewear, according to a report last week from market research firm Counterpoint.

In the first half of this year, Xiaomi's frames were the world's fourth bestselling smart glasses and the third best in the AI glasses segment, according to Flora Tang, a senior analyst at Counterpoint.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.

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